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THEGREATJOURNEY

CPNANNUALREPORT2011

Central Pattana Public Company Limited

Location:

30th – 33rd Floor,

The Offices at CentralWorld,

999/9 Rama I Road,

Patumwan Sub-District, Patumwan

District, Bangkok 10330, Thailand

Telephone: + 66 (0) 2667 5555

Facsimile: + 66 (0) 2264 5593

Corporate Website:

www.cpn.co.th

Registration No:

0107537002443

Year of Establishment:

1980

Business Overview:

Develop and invest in retail property

for rent comprising large-scale

shopping complexes and other related

supportive businesses. In addition,

the Company invests in retail property fund

and acts as a property manager of the fund.

Security Information:

Common shares of Central Pattana Plc.

were listed and traded on the Stock

Exchange of Thailand in 1995 under the

abbreviated security name of “CPN”.

Registered Capital:

Baht 2,178,816,000

Issued and Paid-up Capital:

Baht 2,178,816,000 comprising

ordinary shares of 2,178,816,000 shares

Par value of Baht 1 per share

Contacts:

Corporate Secretary

Telephone: + 66 (0) 2667 5555 Ext.1665

Facsimile: + 66 (0) 2264 5593

Email : [email protected]

Investor Relations

Telephone: + 66 (0) 2667 5555

Ext.1614 or 1669

Facsimile: + 66 (0) 2264 5593

Email : [email protected]

Report of the Audit Committee

Message from the Board

of Directors

Consolidated Operational &

Financial Highlights

Report of the Corporate Governance Committee

Report of the Risk

Management Committee

Report of the Nomination &

Remuneration Committee

221814 262524

List of Committee in Subsidiaries

General Information of Business held by the Company

10% Upward

Management Biography

Information for Investors

Reference FirmsExisting Projects managed

by CPN

251248238 256255252

Capital StructureRisk Factors Sustainability Management

Nomination of Directors

and Management

Management Structure

Organization Chart

116114102 132122120

Vision & MissionsFuture ProjectsOperational Performance

of Assets under CPN’s Management

Nature of Business

Corporate Values

Business Strategy

666253 717068

CONTENTS

Auditor’s FeeFinancial Statements

Audit Report of Certifi ed Public

Accountant

Responsibilty of the Board

of Directors to Financial Statements

Connected Transactions

Remuneration of the Directors

and Management

237151150149138135

Human Capital Development

Human Capital Management

Organization Development

Corporate Governance

Revenue Structure of the Company

and its Subsidiaries

Group Structure of the Company

and its Subsidiaries

1009692797776

2011 Year In Brief Awards of Great Pride

in 2011

Board of Directors and Management

Team

CPN Today2011 Financial Performance

Review

Economic and Retail Industry

Overview in 2011

343028 454036

A Great Journey Makes A Great DestinationTo us, our “To be the most admired and dynamic regional retail property developer with world-class rewarding experience”journey is underway. A new journey to a sustainable destination in which every move is made with confi dence.

Most Admired Retail Developer

Of All Stakeholders

Dynamic Retail Developer

Regional Retail Developer

World-Class Rewarding Experience

To be the most admired and dynamic regional retail property

developer with world-class rewarding experience

There’s no better recipe for a memorable, fruitful trip than a fi ne traveling companion—one that stands behind you, shares your fond moments, and visualizes your goals.

GOODCOMPANION,

GREAT JOURNEY

Let’s Make A Happy &Memorable Journey

Together

Most Admired Retail Developer

Of All Stakeholders

With a fresh perspective on a whole new world, we relentlessly strive for breakthroughs in impressive experiences to pass on to customers. Here lies our source of never-ending inspiration.

FINDINGA GREAT

INSPIRATION

That Always Gives You A Pleasant Surprise

Dynamic Retail Developer

Taking stock of our series of successes to date, we’ve strategized our next move and are poised to hit our stride in becoming the regional leader—a mission well within sight.

Regional Retail Developer

GETTINGREADY FOR

THE NEXT MOVE

And Make Sure You’ll Successfully

Reach Your Destination

With every rewarding experience comes an impressive moment, particularly when such an experience is painstakingly brought to you through world-class quality and standards—all designed for your memorable moments of success.

ENJOYING WORLD-CLASS

EXPERIENCE

That Always Brings aWOW Experience to Your

Extraordinary Life

World-Class Rewarding Experience

|014 015 CPN ANNUAL REPORT 2011

Over three decades of experience and

appreciation of retail property development

represent our key ingredients of success. Our

exceptional performance and enhancing

businesses, spanning strategic trade locations

in Thailand, refl ect not only our professional

expertise, but also a prudent fi nancial policy.

CONSOLIDATED OPERATIONAL AND FINANCIAL HIGHLIGHTS

CPN will be as committed as ever to running

its business with virtue and corporate

governance, and continuing its business

development to achieve the “To be the

most admired and dynamic regional retail

property developer with world-class

rewarding experience” vision.

Revenue breakdown by business Adjusted Earnings per Share(Baht per share)

Total Assets(Million Baht)

79%Retail

6%Offi ce

6%Other Incone

5%Food & Beverage

4%Hotel

Note:

Excludes interest income, dividend

income, share of profi t from associate,

and non-recurring income.

07 08 09 10 11

37,

20

5

43

,78

4

50

,89

5

53

,86

9

64,059

07 08 09 10 11

0.7

2

0.9

9

1.0

5

0.7

1

0.86

Offi ceBook Value per Share(Baht per share)

Shopping Center Retail leasable area (sqm)

Occupancy rate (%)

Total Liabilities(Million Baht)

Total Shareholders’ Equity(Million Baht)

Total Revenues(Million Baht)

Adjusted Net Profi t(Million Baht)

Offi ce leasable area (sqm)

Occupancy rate (%)

07 08 09 10 11

23

,56

5

28

,610

31,

88

7

34

,95

2

43,611

07 08 09 10 11

13,6

39

15,1

73

19,0

08

18,9

18

20,448

07 08 09 10 11

8,2

82

9,2

71

11,7

55

11,3

88

12,766

07 08 09 10 11

1,5

69

2,1

58

2,2

92

1,5

52

1,871

07 08 09 10 11

5.9

8

6.6

5

8.5

7

8.4

8

9.16

07 08 09 10 11

96

%

97%

96

%

95

%

96%

69

7,0

38

761,

111

96

7,4

30

96

4,6

12

1,085,102

07 08 09 10 11

93

%

94

%

86

%

81%

87%

144

,79

1

144

,28

0

163

,74

6

163

,99

1

175,831


As at 31 December 2007 2008 2009 2010 2011

Operational performance of assets under CPN’s management

Leaseable Area (square metres) 848,202 911,764 1,137,549 1,134,976 1,267,306

> Retail 697,038 761,111 967,430 964,612 1,085,102

> Offi ce 144,791 144,280 163,746 163,991 175,831

> Hotel (room) - - 255 557 561

> Residential 6,373 6,373 6,373 6,373 6,373

Occupancy Rate (%)

> Retail 96% 97% 96% 95% 96%

> Offi ce 93% 94% 86% 81% 87%

> Hotel 0% 0% 68% 50% 45%

> Residential 69% 69% 67% 67% 52%

Consolidated Financial Results Unit : (‘000 Baht)

Total Revenues (1) 8,282,131 9,270,743 11,754,650 11,387,613 12,765,702

Revenue from Rental & Service, Food & Beverage, Hotel 7,680,984 8,598,631 10,934,257 10,529,901 11,950,730

Cost of Rental & Service, Food & Beverage, Hotel 4,473,361 4,889,596 6,696,678 6,924,476 7,783,446

Gross Profi t (2) 3,808,770 4,381,147 5,057,972 4,463,137 4,982,256

Net Profi t 1,783,406 2,185,788 4,951,623 1,124,866 2,058,123

Adjusted Net Profi t (2) 1,569,106 2,157,858 2,292,460 1,551,950 1,871,108

Note :(1) Excludes interest income, dividend income, share of profi t of associate, and non-recurring incomes.(2) Excludes non-recurring items.

CONSOLIDATED OPERATIONAL AND FINANCIAL HIGHLIGHTS

As at 31 December 2007 2008 2009 2010 2011

Consolidated Financial Position Unit : (‘000 Baht)

Total Assets 37,204,641 43,783,780 50,895,450 53,869,402 64,059,165

Total Liabilities 23,565,347 28,610,457 31,887,348 34,951,652 43,610,988

Net Interest-Bearing Debt (3) 8,061,863 12,768,404 14,128,862 17,452,337 24,300,067

Total Shareholders’ Equity 13,639,293 15,173,322 19,008,102 18,917,749 20,448,177

Retained Earning 8,720,562 10,089,338 14,539,840 14,339,464 15,828,190

Issued and Paid-up Share Capital 2,178,816 2,178,816 2,178,816 2,178,816 2,178,816

Total Number of Shares (‘000 Shares) 2,178,816 2,178,816 2,178,816 2,178,816 2,178,816

Consolidated Financial Ratios

Net Interest-Bearing Debt to Equity (3) (time) 0.59 0.84 0.74 0.92 1.19

Gross Profi t Margin (2) (%) 46.00 47.26 43.03 39.19 39.03

Net Profi t Margin (2) (%) 18.02 22.02 18.74 13.03 14.06

Return on Assets (%) 4.99 5.40 10.46 2.15 3.49

Return on Equity (4) (%) 14.24 15.89 29.85 6.06 10.71

Earnings per Share (5) (Baht) 0.82 1.00 2.27 0.52 0.94

Adjusted Earnings per Share (2) (5) (Baht) 0.72 0.99 1.05 0.71 0.86

Book Value per Share (Baht) 5.98 6.65 8.57 8.48 9.16

Dividend per Share (pay in the following year) (Baht) 0.33 0.33 0.58 0.25 0.37

(3) Net interest-bearing debt excludes loans from related parties.(4) Excludes minority interest in subsidiaries.(5) Basic earnings per share only attributable to ordinary shareholders.


MESSAGE FROM THE BOARD OF DIRECTORS

To the Shareholders of Central Pattana

Public Company Limited

This year marked the inaugural one in

which CPN has managed its business

under the new (2011-2016) business

plan in the beginning of our corporate

reform to raise our capability and

support our “To be the most admired

and dynamic regional retail property

developer with world-class rewarding

experience” vision. Our main challenges

this year therefore have to do with

domestic business growth expansion to

remain the leader in this business while

restructuring CPN to accommodate

regional growth.

Economic and retail business overview

Healthy, steady growth in the domestic

economy, as well as that in the retail

and wholesale businesses, marked the

fi rst nine months of the year, only to

lead up to Thailand’s Great Floods of the

fi nal quarter, which wreaked widespread

havoc on the manufacturing sector and

the retail and wholesale businesses, with

a ripple effect on the economy as a

whole. Amid the ongoing fl oods, countless

retailers suspended their services

because of merchandise transportation

and distribution hardship, as did CPN’s

three shopping complex projects

(CentralPlaza Pinklao, CentralPlaza

Ramindra, and CentralPlaza Lardprao)—

mainly due to customers’ access

inconvenience and concerns for

employees’ properties and wellbeing.

Fortunately, thanks to employees’

commitment and the methodical

secur i ty v ig i lance p lans of the

management, al l CPN properties

emerged intact in the wake of the

fl oods. Admittedly, lost were the income

opportunities from these three projects

through the suspended periods, which—

however insignifi cant—dented the fi nal

quarter’s performance.

While this unforeseen natural disaster

had a direct bearing on consumers’

spending confidence, the Board and

CPN executives remain upbeat about

the overall fundamentals of the domestic

economy and committed to creating

sustainable domestic growth.

Continued business growth for fi rm future foundation

This year CPN registered success as

planned with the launch of three new

projects: CentralPlaza Chiangrai in

March, CentralPlaza Phitsanulok in

October, and CentralPlaza Grand Rama 9

in December. A remarkable fact about all

three is that their space rents exceeded

90% on their opening dates.

Improved a long with each new

development were existing projects

to supplement value and give CPN’s

shopping complexes a sense of

completeness, sophistication, and

genuine customer satisfaction. Early

this year, we temporarily shut down

CentralPlaza Lardprao (our fi rst shopping

complex, having been in operation

for some three decades) for a total

facelift, including shop replacement.

We fully recognized that this temporary

shutdown would aff ect our short-term

bottom lines because of the missing

revenue, but this move was in the best

long-term interests of CPN. After just

six months, the shopping complex

resumed operation in August with a

totally new look, excellent customer

response, and new tenants from leading

domestic and overseas businesses,

which have strengthened and diversifi ed

this landmark shopping complex. This

was our distinct pride this year.

To lay a firm domestic business

foundation, we have planned continued

shopping complex launches over the next

fi ve years. These formally announced

projects, namely CentralPlaza Suratthani,

CentralPlaza Lampang, CentralPlaza


Ubonratchathani, CentralFestival Hatyai,

and CentralFestival Chiangmai, will

come into service in 2012-2013. In

addition, we are on course in our plan to

grow business in other Asian countries,

but since these are new territories for us,

we need to take time and exercise more

prudence than that for our domestic

expansion.

Performance outcomes illustrate success

This year, CPN and its subsidiaries

grossed Baht 12,953 million in revenue,

an 11% rise from last year, with Baht

2,058 million in net profit, an 83%

rise from last year. This distinctly

remarkable performance resulted from

an extraordinary item which, if excluded,

would shrink these rises to 12% and 21%

respectively. Without this extraordinary

item, the main causes of the revenue

rise are new project launches and steady

rises in rental rates in current projects,

complemented by effi cient marketing

expense management.

In view of CPN’s overall performance

outcomes and fi nancial status this year,

its capability for sourcing capital, and

future investment plans, the Board will

propose to the shareholders’ meeting

on April 27, 2012, dividend payment of

Baht 0.37 per share, or 39% of the net

profi t this year.

Our common Transformation Mission

One of CPN’s challenges is internal

restructuring to achieve the “To be the

most admired and dynamic regional

retail property developer with world-

class rewarding experience” vision.

Capability upgrading and organizational

s t rengthening are as crucia l as

organizational and internal business

process restructuring to support future

business growth.

This year marked the first in which

CPN fully entered corporate reform

under the Transformation Mission, or

T-Mission for short, beginning with

corporate restructuring, approved

by the Board last year. Ongoing

missions consisted of HRIS (Human

Resources Information System) and

business process restructuring, which

accompanied ERP (Enterprise Resource

Planning). These two plans are due for

completion and trial implementation

in 2012.

Awards of pride

Thanks to our commitment to excellence

in corporate development, our manage-

ment and performance are now accepted

domestically and internationally. The

year again saw us win the Board of the

Year for Distinctive Practices (2010-2011)

award, which illustrated management

commitment and effi ciency for develop-

ment and design. CentralWorld and

CentralFestival Pattaya Beach won

severa l accolades f rom leading

international entities, including the

2011 Asia Shopping Centre Awards –

Gold Awards for Grand Opening

Expansion and Renovation from

the International Council of Shopping

Center (ICSC). CPN’s biggest pride,

however, was the Thailand Quality

Class award, conferred on CentralPlaza

Chiangmai Airport by the Thailand

Productivity Institute, Ministry of

Industry.

Success supported by the Central Group

By and large, CPN’s success over the

years has stemmed from its being part

of the Central Group, a leader in the

retail business for the past six decades.

The Group runs a wide range of

b u s i n e s s e s — d e p a r t m e n t s t o re s ,

hotels, restaurants, and assorted retail

businesses. These businesses make up

a signifi cant part of the major and retail

tenants of CPN shopping complexes. In

other words, businesses of the Group

are CPN’s commercial allies that have

raised occupation rates and boosted

other tenants ’ confidence, thus

generating decent returns for CPN’s

shareholders. These commercial relations

between CPN and the Central Group,

while connected to each other, therefore

serve as CPN’s business strengths.

That said, the Board recognizes the

need for transparency of connected

transactions, which must not lead to

confl icts of interest. To deal with this

risk, the Board has defi ned requirements

for regular commercial conditions that

CPN must observe when engaging

itself in connected transactions. The

Audit Committee values and earnestly

reviews the sensibility of CPN’s policy

for connected transactions. Each time

a signifi cant connected transaction is

conducted, the management presents its

details to the Audit Committee for review

and recommendations. In addition,

it discloses complete information as

required by the Offi ce of the Securities

and Exchange Commission and the

Stock Exchange of Thailand.

Despite the challenges posed by external

negative factors and changes inside the

Company this year, the unity shown

by our employees and executives

has enabled us to successfully deliver

planned performance outcomes to the

shareholders. May we therefore take this

opportunity to thank all employees and

executives for their full dedication,

which has played an instrumental role

in CPN’s overcoming of hurdles and

keeping it on great strides.

Finally, the Board expresses its sincere

appreciation to the shareholders, tenants,

commercial allies, fi nancial institutions,

public agencies, private entities, the mass

media, and all customers for their trust in

and excellent support to CPN’s business

management. Please be assured that

CPN will be as committed as ever to

running its business with virtue and

corporate governance in the best interests

of all stakeholders. Our goal is our “To

be the most admired and dynamic

regional retail property developer with

world-class rewarding experience”

vision. Mr. Suthichai Chirathivat

Chairman

Mr. Kobchai Chirathivat

President & CEO


REPORT OF THE AUDIT COMMITTEE

To the Shareholders:

Consisting of four qualifi ed independent

directors, the Audit Committee is

chaired by Mr. Paitoon Taveebhol, who

is knowledgeable and experienced in

the review of financial statements,

with Mr. Chackchai Panichapat, Mrs.

Sunandha Tulayadhan, and Mr. Karun

Kittisataporn as members.

In 2011, there was a total of 11 Audit

Committee meetings, whereby all Audit

Committee members attended all

these meetings, with the exception of

Mrs. Sunandha Tulayadhan, who missed

one meeting due to sick leave, and

Mr. Karun Kittisataporn, who also missed

one meeting due to personal leave.

At some meetings, it consulted the

President & CEO, the management, the

external auditor, the internal auditor,

and non-executive directors as seen

necessary and provided candid views

and recommendations. The Committee

reported its performance to the Board

of Directors on six occasions, with the

following summary of performance

and views:

Accuracy, Completeness, and Reliability of Financial Statements

Reviewed were the quarterly and

annual fi nancial statements, signifi cant

accounting policies and financial

reports, coupled with the consideration

of the audit scope and plans, audit

methods, and detected issues, jointly

investigated by the management and

the external auditor. It is the Committee’s

view that the Company’s financial

reports, prepared under generally

accepted accounting procedures, are

accurate, complete, and reliable with a

sensible choice of accounting policies.

Adequacy of Internal Control System, Internal Audit, Risk Management, and Good Corporate Governance

Reviewed were the audit reports of

Internal Audit and of the external

auditor concerning assessment of the

internal control system, risk management,

and good corporate governance, as well

as the improvement of executives’

performance as recommended in such

reports, while internal processes of

whistleblower system and complaint

handling were also considered. It is the

Committee’s view that the Company’s

internal control system is adequate

and appropriate. The Audit Committee

has reviewed the annual internal audit

plan for the year which is based on

the risk-based audit plan and also the

outputs based on this plan, as well

as have regularly consulted Internal

Audit executives in the absence of the

management. Additionally, the Audit

Committee has approved the hiring of a

fully independent external organization

which is appropriately qualified to

undertake a quality assurance review

of our Internal Audit, as well as the use

of a generalized audit software in order

to enhance the Company’s internal

audit activities. Therefore, the Audit

Committee considers that the Internal

Audit activities of the Company is

independent and appropriate.

Compliance with Securities and Exchange Commission (SEC) Laws, The Stock Exchange of Thailand’s (SET’s) Requirements, and Applicable Laws

Re v i e we d we re t h e C o m p a n y ’s

compliance with SEC laws, SET’s

regulation, and applicable laws; in

addition, the Committee regularly

m o n i t o r e d t h e m a n a g e m e n t ’ s

improvement approach. The Committee

considers the Company in fu l l

compliance.

Transactions with Potential Confl icts of Interest

The Audit Committee has given

emphasis in reviewing, on a quarterly

basis, all connected transactions as

well as those transactions that may

involve possible confl icts of interest in

full compliance with all laws and

regulations of the Stock Exchange of

Thailand. It assigned the Internal Audit

to make the initial assessment, as well

as, every year, always requested the

external auditor to undertake a full

review of all these transactions. The

Audit Committee considers these

connected transactions part of the

normal course of business with regular

commercial conditions, sensible and

fair conditions, and in the best interests

for the Company.

Suitability, Consideration, Selection, and Endorsement of the External Auditor

The Audit Committee made an assess-

ment of the degree of independence

of the external auditor and reviewed

their activities outputs of 2011, which

is their 6th year as the external auditor

of the Company but whereby the

external auditor authorized to sign the

Company’s audited fi nancial statements

has been changed since 2009. The

overall performance of the external

auditor is considered fully satisfactory;

and they have been fully independent

in their audit activities. Additionally,

the Audit Committee had one meeting

with the external auditor without any

management being present, in order

to obtain their direct feedback on the

operational activities by and the degree

of coordination among the involved

management.

As part of its process in reviewing,

selecting and proposing the appoint-

ment of the Company’s external auditor

for 2012, the Audit Committee also

made comparisons of audit fees by

other fi rms. The Audit Committee also

reviewed the proposed audit fees for

2012 together with actual performance

outputs and the scope of work to be

undertaken by the external auditor;

and it, therefore, concurs and consider

it appropriate to propose to the Board

of Directors that KPMG Phoomchai

Audit Limited be again appointed as

the external auditor of the Company

and its Subsidiaries for 2012 with a total

audit fee of Baht 5,530,000.

Overall View and Remarks as a result of Performance under the Charter

The Audit Committee has made a self-

assessment of its overall performance

for 2011 on January 24, 2012; whereby

this assessment is in 2 parts: Firstly,

the overall activities of the Audit

Committee during the year. And

secondly, the specifi c activities of the

Committee, which in total consist of

6 activities, namely : (1) reviewing of the

fi nancial reports to ensure its accuracy

and adequacy; (2) reviewing that both

the internal control systems and

internal audit functions are fully

effective and efficient; (3) reviewing

that the Company activities are in full

compliance with all the requirements

of the securities laws and regulations

of the Stock Exchange of Thailand as

well as the laws relevant to the business

sector in which the Company operates;

(4) reviewing and selecting the proposed

appointment of the Company’s external

auditor; (5) reviewing all connected

transactions; and (6) preparing and

submitting the Report of the Audit

Committee. It is the overall view of the

Audit Committee that it had performed

its duties adequately and completely.

Mr. Paitoon Taveebhol

Chairman of the Audit Committee


6. Reviewed its own charter for more

alignment with the situation and

best-practice guidelines of regulators.

The Nomination and Remuneration

Committee cautiously completed its

duties with integrity, based on the

responsibil i t ies designated in its

charter. It adhered to the principle

of good governance adequately and

suitably for the balanced and sustainable

benefi ts of all stakeholders.

Mr. Chackchai Panichapat

Chairman of the Nomination

and Remuneration Committee

In 2011, the Nomination and Remu-

neration Committee held two meetings

and reported its performance to the

Board for acknowledgment after each

meeting, summarized below:

1. Recruited suitable candidates for

tabl ing to the Board and the

shareholders’ meetings at the 2011

AGM for their consideration. The

Company offered minor share-

holders a chance to nominate

directors from 28 September 2010,

to 14 January 2011. Since no such

nomination emerged, the Committee

recommended that the retired

directors who finished their terms

in 2011 should be reappointed

to another term. The 2011 AGM

approved every nominated director.

2. Considered the 2011 compensation

f o r t h e B o a r d a n d t h e s u b -

committees, comprising the Audit

Committee, the Nomination and

Remuneration Committee, and

the Risk Management Committee,

and then submitted it to the Board

and the shareholders’ meetings for

consideration and approval, taking

into account their responsibilities

and performance related to revenue

earned and other relevant factors.

The compensation amounts are

also compared with industry peers

and met with approval from the

shareholders.

3. Deliberated and provided opinions

on succession plans for senior

executives to ensure that it linked

consistently with CPN’s strategic

plans. These plans were effi ciently

and effectively implemented, with

talent management, CPN Leadership

DNA, and individual development

( IDP) in support of business

expansion.

4. Evaluated the President & CEO’s

performance in the preceding year

and worked with the President &

CEO in setting goals and evaluation

methods for his performance in the

current year.

5. Deliberated and provided opinions

o n t h e C o m p a n y ’ s h u m a n

capital policy and organizational

development, including guidelines

for personnel development and staff

engagement in support of business

expansion.

REPORT OF THE NOMINATION AND REMUNERATION COMMITTEE

the crucial business demand. CPN

is therefore equipped with modern,

eff ective IT technology that covers its

major processes in main and supporting

activities. Installed by an experienced,

credible expert, this system also aligns

with CPN’s vision and strategies that

focus on domestic and overseas growth.

>> Fires, accidents, and other threats related

to shopping center management:

CPN has appointed a loss prevention

team under the supervision of its

Standard Promotion and Supervision

Bureau. Aware of risk factors like fi res

and floods, CPN developed a manual

as the operating regulations for each

branch to study. CPN also executes drills

to simulate diff erent incidents, practices

them, and monitors the outcome to

make sure that they work as planned.

To ensure that its risk management

system works properly and effectively,

CPN has formulated a plan for 2012 which

encompasses every aspect of risk factors,

including risks of investment in new projects

or business expansion, natural disasters,

and terrorism, and applies these factors

at strategic and operating levels. The plan

is specifically adapted to each project to

facilitate the decision-making process and

deal with the risky areas to cover the entire

organization.

Mr. Paitoon TaveebholChairman of Risk Management Committee

REPORT OF THE RISK MANAGEMENT COMMITTEE

CPN has defi ned a clear policy of treasuring

risk management while also recognizing its

responsibility for ensuring good corporate

governance to supplement value to its

shareholders. To this end, CPN focuses on

developing a risk management system,

actively promoting risk management

practices across the Company, and defi ning

a sustainable risk management policy

to identify business risk factors that

encompass all aspects of corporate and

operating risks. Emphasis is on management

of such risks to an acceptable level to CPN.

Two risk management committees are

therefore currently in place:

1. The Corporate Risk Management

Committee considers policies, strategies,

structure, and framework for risk

management system at a higher level.

Besides supporting the top management

in defining the risk management

structure to cover the entire company,

the committee executes risk reviews,

follow-ups, and evaluation of the

effi ciency and eff ectiveness of overall

risk management, with meetings held

at least twice a year.

2. The Operating Risk Management

C o m m i t t e e d e f i n e s r o l e s a n d

responsibilities for directly relevant

parties, those responsible for supporting

technical risk management aspects and

processes, and those responsible for

reviewing such processes. The meetings

take place at least quarterly to present

to its corporate counterpart an overview

of the major risks, the mitigation

methods, and the outcomes of risk

monitoring.

The secretary of the Corporate Risk

Management Committee is assigned to

coordinate and share the major corporate

risks so that its operating counterpart can

turn strategies into practice to encompass

all risks.

This year risk management practices are still

focused on four keys of risk management:

strategic, operation, compliance, and

financial risks. Key risk factors this year

consisted of:

>> Total preparedness to support CPN’s

policy of growth through rapid domestic

branch expansion and domestic

competitiveness:

CPN plans to domestically expand the

business, which could affect project

expansion, by adhering to the principles

of risk management in investment,

in-depth analysis, partners’ preparedness,

re ta i l management to mainta in

competitiveness, enough sources of

capital, and study of the limits of law,

such as the draft act on retail businesses

that could obstruct its expansion.

>> Overseas investment: A team has been

assigned to study the proper directions

and opportunities for investment as

well as fl uctuations in foreign-exchange

rates and interest rates.

>> Change management and adjustment to

accommodate new business processes:

CPN has developed and installed an

IT system that applies the concept

and management method of ERP

(Enterprise Resource Planning) to serve


The Corporate Governance Committee

held four meetings this year and reported

its performance to the Audit Committee

and the Board as summarized below:

1. Improvement of the Code of Ethics and Corporate Governance Policy

CPN has compiled and revised its Code

of Ethics, Corporate Governance Policy,

and related good practices and published

a manual on ‘Code of Ethics and Corporate

Governance Policy’ as guidelines for

the directors, the management, and

employees to acknowledge, master, and

adhere to. This clear and complete manual

of international standards conforms

to corporate governance practices of

widely accepted organizations, such

as the Office of the Securities and

Exchange Commission (SEC), Stock

Exchange of Thailand (SET), Offi ce of the

National Human Rights Commission,

Organisation for Economic Co-operation

and Development (OECD), and the

United Nations Global Compact (UNGC).

The essences of the written revision of

the policy are:

>> The Code of Ethics contains ethics

for directors and the management,

that for employees, and that toward

stakeholders.

>> Policies on intellectual property,

conformance to laws and regulations,

respect for international human

rights principles, anti-corruption,

polit ical participation, public

relations and marketing, among

others, were added to the manual.

CPN has defi ned that the code of ethics

and corporate governance policy are

a part of the company’s discipline that

the management, executives, and staff

must sign an acknowledge form so as

to ensure that all employees strictly

adhere to and conform to it.

2. Dissemination and communication of the Code of Ethics and Corporate Governance Policy

Information about the Code of Ethics

and Corporate Governance Policy

within CPN is disseminated via various

channels, such as staff orientation,

e-mail, intranet, the in-house magazine,

announcements and campaigns, as

well as e-learning. Such information

is also available to the public via the

CPN website under ‘Development for

Sustainability’.

3. Support for compliance with the Corporate Governance Policy

CPN supports compliance with the

policy in line with SET’s regulations and

OECD’s corporate governance policy in

fi ve principles:

1. Rights of Shareholders

2. Equitable Treatment of Shareholders

3. Roles of Stakeholders

4. Disclosure and Transparency

5. Responsibilities of the Board.

In addition to strict conformance to the

above principles, CPN is continuously

committed to develop the implementa-

tion of corporate governance and CSR

activities in line with the sustainable

development approach.

4. Promotion of CSR Activities for the communities, society and stakeholders

This year, CPN constantly promoted

its CSR policy and activities for the

communities, society, and stakeholders

at both the head offi ce and branches as

follows:

>> ‘CPN Share More, Learn More’ to

share with CPN employees know-

ledge and experiences on diet, health,

and personal care

REPORT OF THE CORPORATE GOVERNANCE COMMITTEE

food, clothes, and other essential

i tems, ho ld ing vo lunteer ing

activities to help aff ected people, and

seminars on post–flood housing

restoration, among others.

CPN always stresses performing and

reporting in compliance with the

Corporate Governance Principles.

Thanks to excellent support and

cooperation from the directors, the

management and staff , this year CPN

won the SET Awards 2011 (best corporate

governance report), sponsored by

SET in conjunction with Money &

Banking Magazine. Also, CPN’s corporate

governance report got an ‘Excellent’

rating based on the evaluation of its

2011 CG report by listed companies

for the third consecutive year by the

Thai Institute of Directors (IOD).

Mr. Naris Cheyklin

Chairman of Corporate Governance

Committee

>> ‘Bangkok Metropolitan, Bangkok Noi

District’s Drug-Free Schools’ at Wat

Mali School in a campaign to involve

children and youths in Bangkok

Metropolis in sports and staying

away from drugs

>> Donations of scholarships, learning

facilities, and sports gear to temples,

schools, and universities, including

the Wat Suan Kaew Foundation,

Ban Tian Ang School in Chiang Mai,

Wat Klong Mon School in Samut

Prakarn, and Chula longkorn

University

>> Cash donations and participation

in religious activities at temples

near CPN’s shopping complexes,

renovation of temples, food off erings

to monks, and participating in

hearing sermons

>> Improvement of work processes of

each branch to promote CSR activities

under the ‘CPN Quality Awards

(CPNQA)’ project. For example,

CentralPlaza Chiangmai Airport

set up a ‘My Mind Mission’ project,

a one-stop service caring system for

its retail tenants, and CentralPlaza

Rattanathibet launched the ‘I Go

Green’ project to increase green

areas in the complex.

>> ‘Big Cleaning Day” to clean the

canals around CentralPlaza Pinklao

in cooperation with the government

sector and local residents

>> ‘Energy Day’, held at each branch

to provide knowledge and cultivate

awareness of efficient energy

consumption

>> Dissemination of knowledge,

understanding, and information

on the Company’s CSR activities

on energy and environmental

conservation conducted by each

branch among re ta i le rs and

shoppers

>> Participation in the BEAT 2010

(Building Energy Award of Thailand)

Project by entering CentralWorld

in a contest on energy conservation

operation, held by the Office of

Energy Planning and Pol icy,

Ministry of Energy, from August

2010 to August 2011. As a part of

this project, CPN also transferred

the knowledge to those interested

to enhance their awareness of

energy-saving.

>> Relief to our employees, customers,

and people affected by the Great

Floods through donation of cash,


BOARD OF DIRECTORSAND MANAGEMENT TEAM

01

03

05

07

09

11

02

04

06

08

10

12

01 Mr. Vanchai Chirathivat

02 Mr. Suthichai Chirathivat

03 Mr. Paitoon Taveebhol

04 Mr. Chackchai Panichapat

05 Mrs. Sunandha Tulayadhan

06 Mr. Karun Kittisataporn

07 Mr. Kanchit Bunajinda

08 Mr. Suthikiati Chirathivat

09 Mr. Suthichart Chirathivat

10 Mr. Sudhisak Chirathivat

11 Mr. Sudhitham Chirathivat

12 Mr. Prin Chirathivat

13 Mr. Kobchai Chirathivat

14 Mr. Sudthidej Chirathivat

15 Mr. Naris Cheyklin

16 Ms. Wallaya Chirathivat

17 Mr. Suthipak Chirathivat

18 Mr. Terachart Numanit

19 Ph.D. Nattakit Tangpoonsinthana

20 Mrs. Narttaya Chirathivat

21 Mrs. Panida Sooksridakul

13

15

17

19

21

14

16

18

20

AWARDS OF GREAT PRIDE IN 2011

The year 2011 marked another milestone year for CPN. The 56 prestigious achievements b y l e a d i n g o r g a n i z a t i o n s a n d r a t i n g companies, domestic and international, covering design & development, organization management, marketing & branding, and energy & environmental conservation. These represent just one forward step for us. We are convinced that the application of shopping complex innovations to our development and management in parallel with consistently sound organizational management will lead CPN on a path to sustainable growth and the most admired and dynamic regional retail property development and management.


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01 “Board of the Year for Distinctive Practices for the year 2010 - 2011 “ was

presented to Central Pattana Public Company Limited by Thai

Institute of Directors (IOD), together with the Stock Exchange

of Thailand (SET), the Board of Trade of Thailand, the Federation of

Thai Industries (FTI), the Thai Bankers’ Association (TBA), the Thai

Listed Companies Association, and Federation of Thai Capital Market

Organizations, to honor and encourage listed companies’ qualifi ed and

knowledgeable Board of Directors (Board) who righteously and eff ectively

supervised and ran their companies, acted on behalf of the stockholders

to protect their interests, and created long-term value for the stockholders.

This proved the Board’s leadership, credibility, and effi ciency in their

dedicated management to develop and drive CPN to a great success and

to be recognized nationally and worldwide. Directors who were honorable

recipients of this award comprise:

> Mr.Vanchai Chirathivat > Mr.Suthichai Chirathivat

> Mr.Paitoon Taveebhol > Mr.Chackchai Panichapat

> Mrs.Sunandha Tulayadhan > Mr.Karun Kittisataporn

> Mr.Kanchit Bunajinda > Mr.Suthikiati Chirathivat

> Mr.Suthichart Chirathivat > Mr.Sudhisak Chirathivat

> Mr.Sudhitham Chirathivat > Mr.Kobchai Chirathivat

> Mr.Prin Chirathivat

02 “Thailand Quality Class (TQC) Award” was conferred to CentralPlaza

Chiangmai Airport by Thailand Quality Award Offi ce, National Productivity

Institute under the Ministry of Industry

03 “SET Awards 2011 – Top Corporate Governance Report Award” was

presented to Central Pattana Public Company Limited by The Stock

Exchange of Thailand

04 “2011 Asia Pacific Shopping Centre Awards – Gold Awards for Grand Opening, Expansion and Renovation” was presented to CentralWorld by The International Council of Shopping Centre (ICSC)

Board of the Year for Distinctive Practices for the year 2010 - 2011

05 “2011 Asia Pacific Shopping Centre Awards – Silver Awards for Innovative Design and Development of a New Retail Project” was

presented to CentralFestival Pattaya Beach by The International

Council of Shopping Centre (ICSC)

06 “2011 Asia Pacifi c Property Awards in Retail Development – Thailand” was presented to CentralFestival Pattaya Beach by International Property

Awards in association with Bloomberg Television

07 “2011 Asia Pacifi c Hotel Awards in Best Hotel Architecture – Regional Winner” was presented to Hilton Pattaya Hotel by International Hotel

Awards in association with Bloomberg Television

08 “2011 Asia Pacifi c Hotel Awards in Best New Hotel Construction and Design – Thailand” was presented to Hilton Pattaya Hotel by International

Hotel Awards in association with Bloomberg Television

09 “ASEAN Energy Awards 2011 – Energy Management in Building for Large Building” was presented to CentralWorld by ASEAN Minister on

Energy Meeting (AMEM)

10 “Building Energy Awards of Thailand 2010 (BEAT2010)” was presented

to CentralWorld by Energy Policy and Planning Office, Ministry of

Energy

11 “Thailand Energy Awards 2011 – The Best Energy Effi ciency Award under the category of designated building” was presented to

CentralWorld and The Offi ces at CentralWorld by Ministry of Energy

12 “Thailand Energy Awards 2011 – The Best Innovation for Energy Effi ciency Award under the category of new building” was presented

to CentralPlaza Chonburi by Ministry of Energy

13 “Thailand Energy Awards 2011 – The Best Energy Effi ciency Award under the category of teamwork” was presented to CentralPlaza

Rama 2 by Ministry of Energy

2011 Asia Pacifi c Shopping Centre Awards – Gold Awards for Grand Opening,

Expansion and Renovation”

2011 Asia Pacifi c Shopping Centre Awards – Silver Awards for Innovative Design

and Development of a New Retail Project

02 0803 04

CentralPlaza Lardprao – CPN’s fi rst shopping complex and being in operation for over 30 years – was closed for major renovation, face-lift, and re-merchandising.

CPN unveiled CentralPlaza Chiangrai, the most modern and integrated shoppingcenter in Chiangrai Province, comprising leading stores, restaurants, and an entertain-ment center. The province e q u i p p e d w i t h t o u r i s tattractions and trading zones and was also promoted as a trading gateway to countries along the upper MekhongRiver.

CPN issued 5-year unsecured debentures, in the amountof Baht 500 million, off ered exclusively for institutionali n v e s t o r s , w h i c h w e r e extremely well received.

CentralPlaza Lardprao was r e o p e n e d w i t h a n e w design and a wider variety of shops, providing outstanding ambience and ready toserve customers’ needs while also delivering an enjoyable and ultimately satisfying shopping experience.

CPN held the annual generals h a r e h o l d e r s ’ m e e t i n gnumber 1/2011 covering two major agenda items: 1) approval of its financial s t a t e m e n t s e n d i n g o n 31 December 2 0 1 0 , a n d 2) approval of dividend pay-ments for its performance in 2010.

C P N w a s a f f i r m e d i t s corporate and issue ratings at A+ by TRIS Co., Ltd., reflecting the Company’s strength, credibility and growth.

CPN issued 5-year un-secured debentures, in the a m o u n t o f B a h t 1 , 0 0 0 million, offered exclusively for institutional investors, which were extremely wellreceived.

2011 YEAR IN BRIEF

FEBRUARY MARCH APRIL AUGUST

|034 035

09 10 11 12

C P N w a s a f f i r m e d i t s corporate and issue ratings at A+ by TRIS Co., Ltd., reflecting the Company’s strength, credibility and growth.

CPN signed a 7-year loan agreement with a financial institution for Baht 2,000 m i l l i o n , r e f l e c t i n g t h e Company’s credibility and fi nancial strength.

CPN unveiled CentralPlaza P h i t s a n u l o k , t h e m o s tmodern and integrated shopping center in the lower North – which links Northern region with Central region and Indochinese countries, in compliance with the government’s policy of East-West Economic Corridor.

CPN issued 5-year, 7-yearand 10-year unsecured debentures, in the amount of totaling Baht 2,000 million, o f fe re d e xc l u s iv e ly f o rinstitutional investors, which were extremely well received.

Central region and Bangkok faced a severe f looding. D u r i n g t h e inundation, C e n t r a l P l a z a P i n k l a o , CentralPlaza Ramindra, and CentralPlaza Lardprao were temporarily closed due to inconvenient access and s e c u r i t y r e a s o n s f o r properties and staff.

CPN unveiled CentralPlaza Grand Rama 9, one of the most modern and integrated shopping centers in Bangkok, situated in a business and entertainment zone and conveniently accessed by m a s s t r a n s i t s y s t e m s , including MRTA. The center was surrounded by offices, residences, embassies, and educational institutions.

CPN issued 3.5-year and 5.1-year unsecured debentures, in the amount of totaling Baht 2,000 million, offered exclusively for institutional i n v e s t o r s , w h i c h w e r e extremely well received.

SEPTEMBER OCTOBER NOVEMBER DECEMBER


Economic Overview

Thailand’s economic growth this year

signifi cantly decelerated from last year

because the disaster in Japan aff ected

the production sector, while the severe

flooding in Thailand devastated the

economy on a large scale, especially in

the central region of the country. Several

major industrial estates faced flood-

related problems, resulting in production

halts in many industries, especially the

automotive and electronics industries. It

also aff ected consumption, investment,

and export in the last quarter of the year.

The global economic recession,

including the March catastrophe in

Japan and inundation in Thailand

during the fourth quarter, caused the

manufacturing production index in 2011

to drop from 63.2% last year to 58.2%.

Even though the trade sector enjoyed the

expansion that stemmed from domestic

and foreign demand in the fi rst three

quarters, the fl ooding in the last quarter

slowed down both retail and wholesale

trade businesses. The main problems

were shortage of goods and interrupted

transportation. The real-estate sector

has slowed down since October in

terms of project construction, project

launch, and ownership transfer. Private

investment was also sluggish partly

because investment was accelerated in

the year earlier and there was a shortage

of investment goods due to the problems

in the manufacturing sector.

However, consumption in the private

sector, tourism, and export still expanded.

Overall, the growth in the private sector

dropped from last year because the

lack of goods and inundation hurt the

employment and the household income.

Spending in the last quarter therefore

decelerated. On the other hand, the

tourism sector enjoyed good growth.

The number of foreign tourists in 2011

was 19.1 million, increasing by 19.9%

from last year, thanks to the economic

growth of emerging countries, especially

those in Asia. The export sector grew

by 16.4% from last year. The goods with

the highest expansion rates were rubber,

plastic, and petrochemical products

in line with the exports to China and

Asian countries whose economies still

expanded well.

This year, the average headline infl ation

and core infl ation rose to 3.81% and 2.36%,

respectively, from last year, especially

the prices of food and beverage. It was

caused by a higher production cost from

the tight supply in global markets and the

Great Floods.

ECONOMIC AND RETAIL INDUSTRY OVERVIEW IN 2011

New shop patterns, continuous expansion, intensive marketing tools, and extension of market base to ASEAN are the key driving forces to the continuous growth of Thai economy.

Retail and Wholesale Industry Overview in 2011

This year, Thailand faced the Great

Floods, especially in the central region

and Bangkok. It caused severe damage to

the overall economy, as well as the retail

and wholesale industries. Numerous

industrial estates were closed during the

inundation, affecting manufacturing,

transportation, and product distribution.

Furthermore, several shopping centers,

department stores, and shops were

temporarily closed due to inconvenient

access and security reasons for properties

and staff .

Even though the above-mentioned

incident ravaged the overall economy

for only a short term, the damage was

widespread. Therefore, government

agents adjusted this year economic

growth rate from 9-10% to 6-8%.

In general, the retail and wholesale

business growth in 2011 was derived from

several factors, such as the rising prices of

agricultural products, the populist policy,

and the rising minimum wages and

salaries of government offi cials. Almost

every group of entrepreneurs adapted

themselves to ensure business growth

by expanding branches and markets to

provincial areas, developing new shop

patterns, and intensively using marketing

tools. They also considered expanding

the market base to Asia in response

to Thailand’s participation in ASEAN

Economic Community (AEC) in 2015.

These positive factors were expected to

continue posing eff ects in 2012 and they

were the key factors that support Thai

overall economy continuous growth

in 2012.

Shopping Centers and Department Stores

This year, entrepreneurs in this group

continued to develop new projects,

both in Bangkok and provincial areas.

There were several newly-opened large

shopping malls, namely Terminal 21,

CentralPlaza Chiangrai, CentralPlaza

Phitsanulok, and CentralPlaza Grand

Rama 9. Large shopping centers, such

as CentralPlaza Ladprao, were also

under renovation. Furthermore, a

number of shopping centers in Bangkok,

such as Mega Bangna, The Emporium

2, and Gateway Ekamai, were under

construction and completion was

expected in two years. In additional, The

Mall Bang Khae was under restoration.

In provincial areas, major projects under

construction included CentralPlaza

Suratthani, CentralPlaza Lampang,

Promenada Chiang Mai, and Robinson

Suphanburi. Presently, there were

only few shopping centers in these


areas compared to the incessantly

growing number of population and

higher purchasing power. Entrepreneurs

who expanded the business to potential

markets in provincial areas would

be able to rule the market and create

connections before the situation gets

more competitive.

Competition of the retail business

in Bangkok, especially in areas with

great potential like the city center,

business quarters, and the eastern

side of town around Suvarnabhumi

Airport, was fi ercer than that in other

provinces. Entrepreneurs speeded up

the renovation of existing shopping

malls, area expansion, and improvement

of the merchandizing mix to ensure

more strength in operation. Those who

gained more advantages were the ones

experienced in retail development and

management. They also had enough

capital, connections with shops, and

fl exibility to constantly modernize the

stores.

Marketing strategies remained a crucial

tool to stimulate customers’ spending.

That was why entrepreneurs cautiously

spent their marketing budget. In addition

to attracting target groups, activities

were focused on promoting outlets’

sales in parallel with creating business

alliances that co-hosted major marketing

events to ensure the maximum return

of the spending. More and more tools

for customer relations were used to

increase sales volumes and maintain

customer bases. Only highly experienced

entrepreneurs who had the ability to

adapt themselves to the fast-changing

situation could keep and expand market

shares.

Due to the flooding and political

unrest during the past two years, most

entrepreneurs realized the importance

of security in shopping malls. Good

management systems would help them

stay open under abnormal circumstance.

As a result, entrepreneurs were ready

to put more investment in property

security and safety, such as raising the

security standard and preparing for

water drainage and prevention systems,

to ensure the shopping centers’ normal

operation and maximum safety of

properties.

Community Malls and Lifestyle Malls

Small shopping projects have been

expanding with an investment from

real-estate groups and other groups

that already owned the land. Most

development patterns were in the form

of community malls or mixed-use

development between small shopping

centers and large residential projects to

add value to the overall project.

Major projects launched this year

included The Nine at Rama 9, The

Circle Rachapruek and CityViva Sathorn.

The projects under construction were

Thaniya Park Sri Nakarin, Sena Fest

Charoen Nakorn, and Festival Walk

Nawamin.

In developing these malls, the direction

focused on a harmonious design with

nature. The buildings were open-air

to diff erentiate themselves from large

shopping centers. To attract customers,

they paid attention to the selection

of shops. Most projects consisted of

supermarkets, food outlets, tutoring

schools, beauty parlors, and banks to suit

target customers’ lifestyles.

In the future, the number of this retail

group will continue to rise and face

competition from both large shopping

centers and hypermarkets that reduce

size, adjust services, and add the

characteristics of shopping malls. As

a result, this group must further adjust

itself to maintain its uniqueness, retain

a regular customer base, and continually

increase revenue.

Hypermarkets and Convenience Stores

This group has been expanding branches.

Hypermarkets developed a variety of

project patterns, such as mega retail

only, mixed patterns between retail and

small shopping centers, and small shops

similar to convenient stores.

This year, the sales volumes of this group

enjoyed constant growth except in the last

quarter due to the Great Floods. However,

entrepreneurs in this group expected

that the purchasing power would return

after the government’s compensation

and assistance at the beginning of 2012.

As for the direction of this group, large

branches are not expected to expand

so much because they are restricted by

Town Planning Acts. The entrepreneurs

therefore focus on expansion of smaller

branches, such as Lotus Express, Mini

BigC, Tops Daily, and MaxValue, to easily

reach the consumers.

Strategies to increase sales volume still

focused on discounts, promotions,

premiums, customer services via store

membership cards and credit cards,

and building confi dence in quality and

customers’ satisfaction. Entrepreneurs

in this group emphasized marketing

communication by using key media,

such as television, newspaper, and direct

mail, to promote dynamic promotions.

The group also uses intensive benchmark

campaigns to attract customers.


Performance Overview

In the fi rst three quarters, retail market as

well as business operators enjoyed the

trade expansion that stemmed mainly

from strong domestic demand. The

inundation in Thailand during the

fourth quarter devastated the economy

on a large scale and slowed down both

retail and wholesale trade businesses.

The great fl oods not only decelerated

consumer spending, but also forced

several shopping centers, department

stores, and retail shops to stop their

operations temporarily. This left no

exception for the properties under

the management of CPN. Due to

inconvenient access and security

reasons for properties and staff, CPN

temporarily closed three projects –

CentralPlaza Lardprao, CentralPlaza

Ramindra, and CentralPlaza Pinklao,

of which partial retail property and

two offi ces were in CPN Retail Growth

Leasehold Property Fund (“CPNRF”).

The fl ooding left CPN with no property

damage, but absence of revenue from

those projects during the closure period.

Despite these challenges, CPN accom-

plished its expansion plan with the

launches of three projects – CentralPlaza

Chiangrai, CentralPlaza Phitsanulok,

and CentralPlaza Grand Rama 9 – and

achieved its financial targets. CPN

reported its FY2011 consolidated net

profit of 2,058 MB, increased by 83%

y-o-y with total revenues of 12,953 MB,

grown by 11% y-o-y.

The y-o-y changes in the CPN’s

performance were primarily due to the

following factors:

>> The closure of CentralWorld Shopping Center during April – September 2010, due to a political demonstration in nearby areas and a renovation project.

>> The closure of CentralPlaza Lardprao Shopping Center during February – August 2011 for major renovation.

>> The closure of Centara Hotel &

Convention Center, Udonthani

during June - Nov 2011 for major

refurbishment.

In addition, FY2010 and FY2011 fi nancial

results incorporated the following

non-recurring items:

For FY2010:

>> A 281-MB (after tax) income from

a reversal of provision for doubtful

account and its associated interest

income.

>> A 804-MB write-off (non-cash) of

CentralWorld assets.

>> A 96-MB compensation from the

government for the closure of

CentralWorld during the political

gatherings.

For FY2011:

>> A 187-MB income from reversals of

provisions for impairments of assets.

(See notes to the fi nancial statements

for the year ended 31 December 2011,

Item 28)

Without the non-recurring items, FY2011

consolidated total revenues would have

increased by 12% y-o-y mainly from the

new projects, and the net profi t would

have grown by 21% y-o-y, thanks to

increased rental rates and an effi cient

marketing expense management.

Operational Performance

As at 31 December 2011, CPN managed

18 shopping centers (10 projects in

Bangkok and 8 in the provinces), 7 offi ce

towers, two residential properties

(totaling 62 units). These include the

properties which had been transferred

to CPN Retail Growth Leasehold Property

Fund (“CPNRF”), of which CPN acts

as the property manager. In addition,

CPN owned 2 hotel properties (totaling

561 guest rooms), but outsourced their

managements.

2011 FINANCIAL PERFORMANCE REVIEW

As at the end of FY2011, the occupancy

rate for CPN’s retail properties averaged

95%. Though CentralPlaza Udonthani

experienced a temporary high vacancy

during its renovation, average occupancy

rate of the retail portfolio was relatively

unchanged from that of the preceding

year, owing to the high occupancy

rates of CentralPlaza Lardprao (re-

launched in August 2011) and the

newly opened projects – CentralPlaza

Chiangrai (launched in March 2011),

CentralPlaza Phitsanulok (launched in

October 2011), and CentralPlaza Grand

Rama 9 (launched in December 2011).

Occupancy rate of CentralWorld stood

at 90%; with the re-opening of Zen

Department Store in January 2012,

occupancy of this property bounced

back to 98%.

Rental increases were achieved at

nearly all properties. The impact of the

flooding was short-term and limited

to some certain locations. Excluding

CentralWorld, CentralPlaza Lardprao,

and the three newly opened malls,

other retail properties achieved 6.7%

y-o-y same-store growth on average in

eff ective rents.

As for CPN’s offi ce properties, take-up

rate at the 2011 year-end averaged 85%,

factoring in a 48% take-up rate of the

new offi ce at CentralPlaza Grand Rama 9

Project. Most of the remaining space

was leased out to an anchor – Robinson

Department Store Plc. CPN expected

occupancy of at least 95% by mid of 2012

after the tenant completes its fi tting-out.

Financial Performance

Total Revenues

Revenues from Rent and Services

Even though CentralPlaza Lardprao

was closed for 6-month renovation in

2011 and the two equity-owned projects

were shut down temporarily during the

flooding, FY2011 revenues from rent

and services increased by 11% y-o-y to

10,853 MB, primarily due to three distinct

sources:

>> The 6-month closure of CentralWorld

in 2010.

>> Contributions from the projects

launched in 2011.

>> Continuous increases in rental rates

at most of existing properties.

Food and Beverage Sales

With a full-year absence of sales from

the CentralPlaza Lardprao’s outlet, the

business posted a 15% y-o-y growth

in sales. The increase was attributed

to the new food courts at CentralPlaza

Chiangrai and CentralPlaza Phitsanulok

coupled with an impressive sales

growth at the CentralFestival Pattaya

Beach outlet.

Revenues from Hotel Operations

Hotel operations are considered as

CPN’s non-core businesses. For FY2011,

without contribution from Centara Hotel

& Convention Center, Udonthani – which

was closed for a 6-month refurbishment

in 2011, revenues from hotel operations

grew by 196% y-o-y to 465 MB, mainly

from a full-year contribution of Hilton

Pattaya Hotel.

Total Costs

Costs of Rent and Services

Costs of rent and services constituted

utilities, depreciations and amortizations,

costs on repair & maintenance, on-site

personnel, insurance premium, and

property tax.

For FY2011, costs of rental and services

increased by 10% y-o-y to 7,050 MB.

The increase was primarily due to

compounding eff ects of the following

sources:

>> Lower costs of CentralWorld in

FY2010 due to its 6-month closure,

as previously mentioned.


>> Lower costs of CentralPlaza Lardprao

in FY2011 due to its 6-month closure,

as mentioned previously.

>> A full-year depreciation of the newly

renovated parts of CentralWorld in

FY2011.

>> Cost of rental and services of the new

projects launched in 2011.

Costs of Food and Beverage

Costs of food and beverage constituted

supply costs, on-site personnel, and

depreciations and costs on repair &

maintenance of food center equipment

and furniture. FY2011 costs of food and

beverage increased by 15% y-o-y, due to

the growth in food and beverage sales,

as previously mentioned.

Costs of Hotel Operations

FY2011 costs of hotel operations

amounted to 192 MB, up 186% y-o-y. The

change in costs refl ected the growth in

hotel revenues, as previously mentioned.

Total Operating and Administration

Expenses

Total operating and administration

expenses constituted expenses on

personnel, marketing and promotion,

office supplies, professional fees, and

depreciations of offi ce equipments and

hotel properties.

Total operating and administration

expenses in FY2011 stood at 2,410 MB,

decreased by 16% y-o-y. Without the

non-recurring items, FY2011 operating

and administration expenses would

have surged by 16% y-o-y from full-year

depreciations of Hilton Pattaya Hotel

and higher personnel expenses. FY2011

marketing and promotional expenses

showed a decrease of 11% y-o-y.

Excluding the expenses for the grand

openings of the new projects, FY2011

marketing and promotional expenses

would have been 3.5% of total revenues,

compared to 4.8% of FY2010. These

numbers refl ected not only the economy

of scale, but also the effi ciency of marketing

expense management through top-line

driven.

Net Profi t

CPN reported its FY2011 consolidated

net profi t of 2,058 MB, up 83% y-o-y.

Without the non-recurring items, the net

profi t would have grown by 21% y-o-y,

thanks to increased rental rates at most

of existing projects and the efficient

marketing expense management.

New Developments

Under its 5-year plan, CPN aims to

increase its revenues at a compound

annual growth rate (CAGR) of 15%

per annum. To achieve this goal,

apart from increasing rents through

continuous asset enhancement and

efficient property management, CPN

targets to grow its portfolio by 10%

a year through new developments.

In light of Thailand’s urbanization,

CPN will expand its business more

aggressively in provinces.

In 2011, CPN achieved its target with

the launches of three new projects –

CentralPlaza Chiangrai (Northern

Thailand), CentralPlaza Phitsanulok

(Central Thailand), and CentralPlaza

Grand Rama 9 (Bangkok). For 2012,

CentralPlaza Udonthani will complete

its enhancement project with new retail

space in the fi rst half, and two under-

construction projects – CentralPlaza

Suratthani (Southern Thailand) and

CentralPlaza Lampang (Northern

Thailand) – are due to complete in the

second half. In addition, there are three

projects under works and two land

plots under detailed studies.

Capital Structure

Total CAPEX for FY2011 was approximately

13,000 MB, comprising 3,000-MB asset

enhancement projects, 5,200-MB new

developments, and 4,800-MB land

acquisitions. During FY2011, CPN raised

new debts of approximately 6,700 MB,

comprising 5,000-MB unsecured bonds

and 1,700-MB long-term borrowings.

As at the end of FY2011, interest-bearing

debts stood at 25,245 MB, comprised 91%

fi xed and 9% fl oating interest rate with

a weighted average interest rate of 4.3%

per annum. As at the end of FY2011, net

interest-bearing debt to equity ratio stood

at 1.2 times.

To achieve the revenue target, CPN

estimated its FY2012 CAPEX of 14,000 –

14,500 MB, funded through operating

cash fl ow, long-term borrowings, and

cash proceeds from lease/sublease of

an offi ce property to property fund.


CenCCenCenCentratratratrat lPllPllPlPllPllPllPlazaazazaazaazaaza LaaLaLardprdpdprddprdrd raoraoaooora

CentralPlaza Chiangrai

Nowadays, CPN develops and manages

18 shopping complexes, seven office

projects, two hotels, and two residential

buildings. The newly opened projects

in 2011 were CentralPlaza Chiangrai,

CentralPlaza Phitsanulok, and CentralPlaza

Grand Rama 9, in addition to the re-

launched CentralPlaza Lardprao with

a totally new look.

CPN TODAY

Over three decades of full dedication, CPN has continually grown and enthroned as the leader in retail property market by having the largest and most modern shopping centers in Thailand. Our goal is “To be the most admired and dynamic r e g i o n a l r e t a i l p r o p e r t y developer with world-class rewarding experience.”

10 818

CPN’s long-term business strategy is

to develop shopping complexes with

world-class standards in potential

locations, both in Bangkok and pro-

vincial areas, capable of yielding high

profits. Furthermore, CPN has future

plans for business expansion to overseas

projects, particularly to countries with

substantially high economic growth rate.

Potential Location

As the leading retail property developer,

CPN is well aware that location is crucial

for being a successful market leader.

Moreover, the experiences in selecting

the location of each shopping complex

and profound comprehension in retail

business are significant elements for

CPN to obtain the highest potential

location for success shopping complex

development.

premiumshopping centers

in Thailand

shopping centers in Bangkok Metropolitan Area

and its vicinities

shopping centers in prime

provincial areas


01

Total project GFA: 310,000 sq.m.

Parking space: 3,000 vehicles

Bangkok

02



Bangkok

03



Bangkok

With its new outstanding organic-form design inspired by

beauty of nature, Thailand’s fi rst integrated shopping complex,

CentralPlaza Ladprao, was re-launched as the newest lifestyle

destination, fully equipped with innovative facilities and services.

Under new sky lights, shoppers will experience a new relaxed

ambience. The complex comprise hotel, offi ce building, Central

Department Store, and shopping center with a full range of

leading domestic and international retailers

This shopping center was built for family and community,

consisting of Central Department Store, retails, restaurants, and

six movie theaters. Regular family-oriented and community

activities and easy access by public transportation, CentralPlaza

Ramindra is a perfect shopping mall for families and community.

As the integrated shopping complex on the west side of

Bangkok, CentralPlaza Pinklao can respond to the needs of

various target customer segments, such as educational

institutes, offices, and communities with high purchasing

power and strong growth. It includes leading retail shops,

food and beverage outlets, 11 movie theaters, Central

Department Store, and two offi ce buildings.

04


Parking space: 400 vehicles

Chonburi

05



Chiangmai

06



Bangkok

Central Center Pattaya caters to respond to various customers –

local residents, business and convention travelers, Bangkokians

who visit Pattaya during weekends, and over two million

tourists who travel to Pattaya per year. Central Center Pattaya

not only is an exquisitely decorated tropical architectural

center, but also anchored by a Big C Super Center and six

movie theaters.

CentralPlaza Chiangmai Airport is the largest shopping

and entertainment complex in the north of Thailand,

accommodating approximately six million visitors a year

including Thai and foreign tourists. It embraces Robinson

Department Store, seven movie theaters, a multi-purpose

convention hall, and a “Northern Village” – local handicraft

zone with all-inclusive famous items of the northern region

for clients to comfortably shops.

CentralPlaza Ratchada - Rama 3 is situated in Bangkok’s

new economic district, in the vicinity of fi ve leading banks’

head offi ces, and it is the only integrated shopping complex

with an entertainment place within fi ve kilometers, including

various retails, Central Department Store, a food park, a

26-lane bowling center, nine movie theaters, and a game

arcade


07



Bangkok

08



Bangkok

CentralPlaza Bangna is situated in the east side of Bangkok,

near Suvarnabhumi Airport, and with rapidly growing

communities. It was designed to be an all-encompassing city

within a city, comprising of a six-story shopping complex,

a condominium tower, a 37-story offi ce tower, movie theaters,

a water park, and a high-tech game center.

09



Bangkok

CentralWorld located in the heart of Bangkok and became the

largest shopping complex in South East Asia. CentralWorld

houses Zen Department Store and Isetan Department Store,

SF World Cineplex, TK Park, and flagship stores of world

renowned brand. Other components to complete the

comprehensive project are a grade - A offi ce building with

45-storey. With its prime location and variety, CentralWorld

has become an admired destination among local and foreign

tourists.

CentralPlaza Rama 2 is located on a main highway in the

south of Bangkok, a rapidly expanding residential district.

The complex has Central Department Store, Tops Supermarket,

Offi ce Depot, HomeWork, B2S, 350 retail shops, a food center,

an entertainment and leisure complex, a 30-lane bowling

alleys, 10 movie theaters, and public garden space.

11



Nonthaburi

12



Chonburi

Being the largest and most comprehensive lifestyle shopping

complex on the northwestern side of Bangkok, the complex is

outstanding for its design technology with energy-saving and

eco-friendly. The shopping complex consists of a seven-storey

shopping mall and a 16-storey office tower. Surroundings

by Government Centre and commercial buildings, the project

has become a destination for all needs with completed

combinations of Central Department Store, movie theaters,

fashion and boutique shops, food and beverage outlets, as

well as over 300 leading stores.

10



Nonthaburi

After acquiring Siam-Jusco Rattanathibet in December 2003,

CPN changed the name and refurbished the building into

a shopping center in a warm ambiance for families, providing the

best comfort. The complex consists of Robinson Department

Store, Index Living Mall, HomeWork, Office Depot, movie

theaters, and a bowling alleys to add varieties to truly be the

family’s favorite shopping mall.

CentralFestival Pattaya Beach is Asia’s largest natural beach-

front shopping complex. The project comprises a shopping

mall and a hotel with 360 panorama view of Pattaya Beach.

The project has brought modern and lively lifestyle center to

the tourist city. The complex includes Central Department

Store, SFX Cinema, and over 350 shops in total of renowned

fashion boutiques, international restaurants, retail shops, as well

as the arena in front of the shopping mall for lively activities

among local and foreign tourists.


13



Udonthani

14



Bangkok

15


Convention Centre: 4,800 sq.m.


Khonkaen

Located en route to Indochina is the lifestyle complex of the

upper Northeast that fi nds popularity with Thais and those

from neighboring countries alike. The shopping complex

consists of Robinson Department Store, Tops Supermarket,

movie theaters, bowling alleys, and over 500 retail shops.

Fulfi lling the project’s scope is Centara Udonthani Hotel with

259 rooms and sizeable multipurpose conference rooms.

The largest and most complete lifestyle shopping complex in

Chonburi province, marked by a unique architectural design

to enable shoppers to feel the sunlight permeating through

the clear glass façade. Inside, one fi nds Robinson Department

Store, SF Cinemas City, the fi rst modern karaoke in the city,

and over 250 varieties of retail shops, fashion boutiques, food

and beverage, and entertainment zone.

CentralPlaza Khonkaen is the largest and most modern lifestyle

shopping complex of the Northeast with an architectural style

of Northeastern art and cultural form, and by a green-building

concept for energy conservation. Inside, one fi nds Robinson

Department Store, SF Cinemas City, bowling alleys, and over

250 retail shops, fashion boutiques, food and beverage, as well

as a large convention center. The variety and completion of

the project has supported Khonkaen province to be a center of

educational activities, government centers, and commercial

units in the northeast of Thailand.

16



Chiangrai

17



Phitsanulok

18



Bangkok

CentralPlaza Chiangrai is the fi rst lifestyle shopping center

of Chiangrai province with an architectural style of Northern

(Lanna) art and beauty of nature. Recognized as Thailand’s

fi rst shopping center by an eco-friendly concept, CentralPlaza

Chiangrai was developed by using green technologies,

environmentally friendly materials, and energy-efficient

equipments. Inside, one fi nds Robinson Department Store,

Tops Supermarket, PowerBuy, B2S, SuperSport, Major Cineplex,

karaoke, and over 200 retail shops, fashion boutiques, and food

and beverage.

Situated in the center of a business zone – which links the

Central region with the Northern region and Indochinese

countries, CentralPlaza Phitsanulok is outstanding for its

design inspired by traditional Thai-style – Benjarong – pottery,

fl oating houses, and creative art of Thai textile. The shopping

complex consists of Robinson Department Store, Tops

Supermarket, PowerBuy, B2S, SuperSport, Major Cineplex,

and over 200 retail shops.

Located in a high potential business zone of Bangkok, the

one-stop lifestyle entertainment shopping complex is

outstanding for its modern futuristic design with the LED

lights. Positioned as a dream destination for “work & play”

generations, CentralPlaza Grand Rama 9 comprises the most

modern flagship store of Robinson Department Store,

Tops Market, PowerBuy, B2S, SuperSport, Office Depot,

world-class 11-screen SFX Cinemas, Thailand’s first

Olympic-sized ice skating rink, and over 300 retail shops.

CentralPlaza Grand Rama 9

Data as of 31 December 2011

Retail Properties

Year of Operation

Development

Land Ownership

Investment Cost of Total Project as end of 2011 2

Leaseable Area (Sq.m)

Occupancy Rate (%)

No.of Tenants (shops)

Top Five Anchor Tenants 3

01CentralPlaza Lardprao

December 1982

Greenfi eld

Leasehold end of 2028

4,303

47,850

100%

295

SFX Cinema

03CentralPlaza Pinklao 1

March 1995

Greenfi eld


1,163

60,098

97%

263

Major Cineplex, SB Furniture, B2S

02CentralPlaza Ramindra

November 1993

Greenfi eld


599

17,156

98%

80

SFC Cinema, PowerBuy, SuperSports

04Central Center Pattaya

July 1995

Greenfi eld


367

15,226

97%

132

SFC Cinema, SuperSports

OPERATIONAL PERFORMANCE OF ASSETS UNDER CPN’S MANAGEMENT

Remarks: 1 For CentralPlaza Pinklao, 42% of asset was subleased to CPNRF since November 2009 to December 2024. For CentralPlaza Ratchada - Rama 3, 81% of asset was leased to CPNRF since August 2005 to August 2035. For CentralPlaza Rama 2, 96% of asset was subleased to CPNRF since August 2005 to August 2025. Operational performance of CentralPlaza Pinklao, Ratchada - Rama 3, and Rama 2 includes those of assets transferred to CPNRF and CPN acts as the property manager.2 Includes investment of offi ce/residentail/hotel components. Excludes annual lease payments and investments of the assets leased/subleased to CPNRF.3 Anchor are tenants who occupy over 1,000 sq.m. of leaseable area.


Retail Properties

Year of Operation

Development

Land Ownership



Occupancy Rate (%)



05CentralPlaza Chiangmai Airport

March 1996 4

Acquisition

Freehold

3,163

75,918

99%

518

Robinson Department Store, Tops Market, Major Cineplex, Califonia Wow, IT City

08CentralPlaza Rama 2 1

December 2002

Greenfi eld


1,011

100,329

100%

352

Central Department Store, Home Works, Major Cineplex & Bowling, Tops Super, Offi ce Depot

07CentralPlaza Bangna

December 2001 4

Acquisition

Freehold

4,163

53,297

97%

277

Major Cineplex & Bowling, Toy R’Us, IT City

06CentralPlaza Ratchada - Rama 3 1

October 1997

Greenfi eld

Freehold

1,280

58,805

100%

301

Major Cineplex & Bowling, Fitness First, IT City

Remarks: 1 For CentralPlaza Pinklao, 42% of asset was subleased to CPNRF since November 2009 to December 2024. For CentralPlaza Ratchada - Rama 3, 81% of asset was leased to CPNRF since August 2005 to August 2035. For CentralPlaza Rama 2, 96% of asset was subleased to CPNRF since August 2005 to August 2025. Operational performance of CentralPlaza Pinklao, Ratchada - Rama 3, and Rama 2 includes those of assets transferred to CPNRF and CPN acts as the property manager.2 Includes investment of offi ce/residentail/hotel components. Excludes annual lease payments and investments of the assets leased/subleased to CPNRF.3 Anchor are tenants who occupy over 1,000 sq.m. of leaseable area.4 Year of acquisition.

10CentralPlaza Rattanathibet

December 2003 4

Acquisition

Freehold

2,218

77,281

99%

215

Robinson Department Store, Home Works, SFC Cinema, Index Living Mall, Tops Market

11CentralPlaza Chaengwattana

November 2008

Greenfi eld

Freehold

5,189

65,550

95%

395

SFX Cinema, Fitness First

09CentralWorld

December 2002 4

Acquisition


16,065

187,046

90%

495

Zen Department Store, Isetan Department Store, SF World Cinema, Central Food Hall, Center Point, SB Design Square, Power Buy


Remarks: 2 Includes investment of offi ce/residentail/hotel components. Excludes annual lease payments and investments of the assets leased/subleased to CPNRF.3 Anchor are tenants who occupy over 1,000 sq.m. of leaseable area.4 Year of acquisition.

Retail Properties

Year of Operation

Development

Land Ownership



Occupancy Rate (%)



12CentralFestival Pattaya Beach

January 2009

Greenfi eld

Freehold

6,104

57,150

98%

313

SFX Cinema & Strike Bowl, Toy R’Us

15CentralPlaza Khonkaen

December 2009

Greenfi eld

Freehold

3,972

50,156

96%

363

SFC Cinema & Strike Bowl, Tops Market, PowerBuy

14CentralPlaza Chonburi

May 2009

Greenfi eld

Freehold

2,918

40,294

97%

301

SFC Cinema, Tops Market, PowerBuy, Fitness First, SuperSports

13CentralPlaza Udonthani

April 2009 4

Acquisition

Freehold

3,289

43,988

90%

82

Robinson Department Store, Major Cineplex & Bowling, Sport World

17CentralPlaza Phitsanulok

October 2011

Greenfi eld

Freehold

1,483

27,418

100%

154

Robinson Department Store, Major Cineplex, Tops Market, PowerBuy, B2S, SuperSports

18CentralPlaza Grand Rama 9

December 2011

Greenfi eld


5,020

84,697

93%

184

Robinson Department Store, SFX Cinema, Tops Market, PowerBuy, B2S, SuperSports

16CentralPlaza Chiangrai

March 2011

Greenfi eld

Freehold

1,597

23,515

98%

116

Robinson Department Store, Major Cineplex, Tops Market, PowerBuy, B2S, SuperSports


Offi ce Properties

Year of Operation

Development

Land Ownership


Occupancy Rate (%)

No.of Tenants (units)

Major Business Type of Tenant

01Lardprao Offi ce

December 1982

Greenfi eld


16,397

94%

66

Tutorial, Language, and Computer School, Clinic, Health Care & Beauty palor, General Off fi ce Administration

Remarks:1 Pinklao Tower A and Tower B were subleased to CPNRF since November 2009 until December 2024.2 Year of acquisition.

02Pinklao Tower A Offi ce 1

March 1995

Greenfi eld


22,426

96%

52

Tutorial, Language, and Computer School, Government Agency, General Off fi ce Administration

03Bangna Offi ce

December 2001 2

Acquisition

Freehold

10,007

92%

27

Tutorial,Language, and Computer School, Clinic, Health Care & Beauty parlor, General Off fi ce Administration

04The Offi ces at CentralWorld

November 2004

Acquisition


82,796

93%

99

Multinational Corporation, Bank & Financial Institution, Law & Business Consultant, Communication & Services

05Pinklao Tower B Offi ce 1

March 2006

Greenfi eld


11,334

98%

51

Tutorial,Language, and Computer School, Clinic,Health Care & Beauty,General Off fi ce Administration

06Chaengwattana Offi ce

March 2009

Greenfi eld

Freehold

19,708

67%

45

Tutorial,Language, and Computer School, Clinic, Health Care & Beauty parlor, Communication & Services, General Off fi ce Administration

07Grand Rama 9 Offi ce

December 2011

Greenfi eld


13,163

48%

184

Tutorial,Language, and Computer School, Clinic, Health Care & Beauty parlor, General Off fi ce Administration


Hotel Properties

Year of Operation

No.of Guest Rooms

Occupancy Rate (%)

Residential Properties

Year of Operation


Occupancy Rate (%)

01Centara Udonthani 1

April 2009 3

259

33%

01Langsuan Colonade

December 1998

4,466

56%

02Hilton Pattaya 2

November 2010

302

56%

02Central City Residential 1

December 2001 2

1,907

43%

Remark:1 CPN owns strata-title of 12 units of the condominium.2 Year of acquisition.

Remark:1 CPN is the project owner and Central Plaza Hotel Plc is the hotel manager.2 CPN is the project owner and Hilton Hotel Corporation is the hotel manager.3 Year of acquisition.

Hilton Pattaya Hotel


01 CentralPlaza Suratthani

Location:

On the airport highway merging with

Highway 417, Wat Pradu Sub-District,

Muang District, Surat Thani Province

Size:

Approximately 62-rai plot of land (CPN

has the land ownership) and a total

project area of 130,000 sq.m., of which

109,700 sq.m belongs to CPN. The

project consists of Department Store

and anchor tenants, including Tops

Market, Power Buy, B2S, and SuperSports.

There are over 160 retail shops, including

boutique and fashion stores, banks,

service centers, restaurants and cafés,

cinemas, a multipurpose convention

center, as well as a parking lot which

can accommodate more than 1,400

vehicles.

Potential:

The project is located in Surat Thani

Province, the trade center of the upper

South. With a location on a new economic

road that links the city with the airport,

the project can well respond to the

expanding city and reach the target

group of local and foreign tourists,

whose number is steadily increasing.

FUTURE PROJECTS

Furthermore, the project is surrounded

by major attractions, educational

institutions, and government agencies.

The province is also a major trade and

tourism spot of the southern region

thanks to its border connected with fi ve

provinces.

Progress:

Under construction, progressing as

planned and budgeted.

Opening schedule:

The project is expected to be inaugurated

in the last quarter of 2012.

Investment:

Approximately 1,900 MB (excluding

investment in Robinson Department

Store, which is under the responsibility

of Robinson Department Store Plc.)

02 CentralPlaza Lampang

Location:

On Highway 1, Nakhon Sawan – Chiang

Rai, Tambon Hua Wiang, Amphoe

Muang, Lampang Province

Size:

Approximately 39 rai of land (the lease

right ends in 2041) with a total project

area of 90,000 sq.m., of which 72,000

sq.m. belongs to CPN. The project

consists of Robinson Department Store



There are also cinemas, a Fun Planet

amusement park, over 100 retail shops,

such as boutique and fashion stores,

banks, service centers, restaurants, and

cafés, as well as a parking lot for more

than 800 vehicles.

Potential:

Located in a high-potential area, the

project is in the heart of Lampang, on

Lampang – Laos Super Highway Road,

which connects the city with the airport.

It is also surrounded by major sites,

such as a university, higher education

institutions, colleges, hospitals, and

banks. Lampang has a major economic

route that connects Thailand with

Laos and China, and its border is next

to seven high-potential Northern

provinces. Moreover, it is near major

tourist destinations, including historical

sites and a national park. As a result,

Lampang is a major tourist destination

in the North, welcoming local and

foreign tourists throughout the year.

This signifi cantly increases the potential

purchasing power.

Progress:


planned and budgeted

Opening schedule:



Investment:



Store, which is under the responsibility

of Robinson Department Store Plc)

03 CentralPlaza

Ubonratchathani

Location:

On Highway 231, Tambon Chae Ra Mae,

Amphoe Muang, Ubon Ratchathani

Province

Size:

Approximately 76 rai of land (CPN has

the land ownership) with a total project



consists of Robinson Department Store



There are also cinemas, a Fun Planet

amusement park, over 250 retail shops,


such as boutique and fashion stores,

banks, service centers, restaurants, and

cafés, as well as a parking lot for more

than 1,500 vehicles.

Potential:

The project is in Ubon Ratchathani

province, a major Northeastern border

province. It is situated on the bypass,

which connects the city with the airport.

It is also surrounded by major sites,

such as a university, higher education


banks. Ubon Ratchathani is the gateway

to trade and tourism in Indochina,

namely Thailand, Laos, Cambodia, and

Vietnam. In the future, the Department

of Land Transport will expand an

international road system, namely

Ubon Ratchathani – Champa Sak, Kon

Pa Peng, and Siam Reap. It is therefore

a major economic town regarded as

suitable for investment and signifi cant

development in the future.

Progress:



Opening schedule:


in the fi rst quarter of 2013.

Investment:



Store, which is under the responsibility of

Robinson Department Store Plc)

04 CentralFestival Chiangmai

Location:

At the intersection of the superhighway

and Chiang Mai-Doi Saket Road, facing

both superhighway and Chiang Mai-

Doi Saket Road.

Size:

Approximately 68-rai plot of land in

total (CPN has the land ownership) with

a total project area of 250,000 sq.m. The

project consists of Central Department

Store and anchor tenants, including

Central Food Hall, Power Buy, B2S, and

SuperSports. There are also cinemas,

3D cinemas, a Fun Planet amusement

park, over 250 retail shops, such as


service centers, restaurants, and cafés,

as well as a parking lot for over 1,500

vehicles.

Potential:

This project is located in Chiang Mai

Province, a capital city of the North and

a high-potential area in development

and growth, in terms of economic and

investment and the biggest tourism

in the North, only second to Bangkok.

This project is situated on the Highway

Road, which connects the city with the

airport. This project is also surrounded

by major sites, such as a university,

higher education institutions, colleges,

hospitals, and banks. Furthermore,

Chiang Mai is a popular cultural and

natural tourist destination among local

and foreign tourists, which will enhance

their remarkable growth in purchasing

power.

Progress:

A detailed feasibility study is ongoing.

Opening schedule:



Investment:


investment in Central Department Store,

which is under the responsibility of

Central Department Store)

05 CentralFestival Hatyai

Location:

On Highway 4, Kanchanawanit Road,

Tambon Koh Hong, Amphoe Hat Yai,

Songkhla Province. The front is next to

the highway, with one side connecting

with Chotewitthayakul 1 Road, which is

an easy access to the city center.

Size:

Approximately 50 rai of land (CPN has

the land ownership) with a total project



consists of Central Department Store


Market, Power Buy, B2S, SuperSports,

and Offi ce Depot. There are also cinemas,

3D cinemas, a Fun Planet amusement

park, an ice-skating rink, a large meeting

room, over 250 retail shops, such as


service centers, restaurants, and cafés,

as well as a parking lot for more than

2,100 vehicles.

Potential:

The project is situated in a high-potential

area in the heart of Hat Yai, considered

a large city as well as the leading trade

and business center in the South. It is on

the road which connects the city with

the international airport, regarded as

Thailand’s number fi ve in traffi c volume.

It is also the gateway to Malaysia and

Singapore, whose populations have

high purchasing power. Furthermore,

the project is surrounded by major sites,

such as universities, higher educational


banks. This economic and tourist

destination indeed welcomes many

Thai and foreign tourists. The project

is also located in a strategic area of

economic development, which consists

of Indonesia, Malaysia, and Thailand.

This signifi cantly increases the potential

purchasing power and great development

in the future.

Progress:



Opening schedule:


in the third quarter of 2013.

Investment:

Approximately 4,500 MB

06 Overseas Projects

Since the Company has foreseen

business opportunities and would like

to diversify risks, for the past four

years, CPN has studied opportunities

to expand its investment abroad by

focusing its interest on Asian countries

with high potential and economic

growth. Yet, CPN is aware of diff erences

in market circumstances, competition

conditions, and risks arising from

overseas businesses. The Company,

therefore, has appointed a team of

specialists to study economic, social,

and political conditions, industry and

competition, business laws, and other

risks in each country that CPN is

interested in to ensure that overseas

investment has been carried out

prudently for steady and sustainable

growth.


To be the most admired and dynamic regional retail property developer with world-class rewarding experience

Based on the above-mentioned

vision, CPN strives to accomplish four

missions to turn its vision into reality.

MissionsVision

1. Most admired retail developer of all stakeholders

To be the preferred mall of choice, delivering extraordinary values that exceed al l stakeholders ’ expectations”

>> To be the investor of choice by

d e l i v e r i n g c o m p e t i t i v e a n d

sustainable returns to shareholders,

investors, and strategic partners.

>> To be the happiness experience

destination of targeted shoppers by

delivering world-class rewarding

experience.

>> To be the most preferred partner

of targeted tenants and partners by

delivering business success together

with long-term relationships.

>> To be the top-ranked employer

of choice by off ering brilliant career

opportunities and engaged society.

>> To be the most socia l ly and

community-admired brand through

CPN’s shopping mall positioning

and signature corporate social

responsibility programs.

2. Dynamic retail developer

To create new retail formats and merchandising mix that fi t better with our targeted customers’ changing lifestyles.

CPN fully recognizes that customers’

dynamicity poses a key challenge. By

the minute, customers have higher

expectations, more complicated needs,

and ready access to information. CPN’s

own dynamicity pushes its shopping

centers toward greater sophistication

to cater to customers’ lifestyles. To this

end, CPN never stops inventing formats

for shopping centers, selects novelty

shops and outlets that are both modern

and match customers’ needs, applies

advanced technology to customer

services, stages outstanding and unique

activities to create new experiences

for customers, and synergizes with

affiliates in catering to customers’

needs while striving for maximum

impression among service users.

VISION AND MISSIONS

4. World-class rewarding experience

To be the shopping mall destination delivering world-class shopping experience superior to those of our competitors in all markets that we have presence in

Constantly recognizing that CPN is not

just a shopping center developer, but

also a deliverer of happiness to everyone,

we ensure that all components of our

shopping centers pay due attention

to service users—whether through

shop selection aimed for diversity and

novelty, staging of interesting activities,

or complete amenities. CPN is convinced

that high standards and world-class

qualities lead to market leadership,

which is why we are always committed

to attaining world-class status. We

are convinced that our world-class

happiness experience can put CPN at

the top of customers’ mind and at the

top of regional shopping center

developers’ list in the future.

3. Regional retail developer

To be a potential leader in the region and be considered as threat in all markets that we operate in

CPN is committed to steady, sustainable

growth, with the next step being a

regional organization. To this end, we

are committed to becoming a renowned

retail property developer, with rapidly

successful regional projects. Our

prospective markets are clearly identifi ed

after prudent, strategic deliberation,

with business plans and alliance

formation plans that can promptly

address business opportunities. All the

time, the organization and its teams

develop themselves for the capability

and readiness to operate overseas

business as envisioned.


CPN emphasizes steady and sustainable growth in both fi nancial and organizational aspects to ensure satisfaction of all stakeholders and achieve goals and missions. CPN’s main elements of the overall strategy are as follows:

>> E f f i c i e n t s h o p p i n g c o m p l e x

development, from conducting

feas ib i l i ty s tudies , acquir ing

locations, supervising designs and

construction, contacting shops,

marketing, to commercial opening,

so that CPN can develop various

new projects s imultaneously,

within schedule and budget.

>> Standardization development in

decoration and construction to

reduce construction time and costs

as well as operating costs, with

acceptable standards.

>> International business development,

covering in-depth market studies of

customers’ behavior, competitors,

restrictions, related regulations,

market options, and prioritization

of targeted markets, international

partners and alliances, designing

mall formats, management, and so

on.

1. Strategy for Shopping Complex Development

CPN focuses on expanding its business

steadily in both Bangkok Metropolis

and provincial areas. The complexes

are constant ly modernized and

opportunities for new international

expansion sought so as to establish

steady and sustainable growth and

be ready for the ASEAN Economic

Community in 2015.

CPN emphasizes developing and

improving shopping complexes of

high potential, with quality, timely, and

on-budget project management.

>> High-potential shopping complex

development, starting from market

research to identify potential

markets, acquiring strategic locations,

des igning mal l formats , and

allocating an appropriate proportion

of merchandising mix to meet

customers’ expectations while

staying ahead.

BUSINESS STRATEGY

2. Strategy for Complex Management

CPN focuses on supplementing value

from existing complexes through

reinforcing the strengths of retails

shops, marketing, and management

of the complexes to boost business

growth and rental prices and supervise

operating costs.

To do a good job of addressing tenants’

and customers’ needs, management of

complex emphasizes the following

areas:

>> Merchandising mix through market

and customer analysis and adjusting

the shops as well as finding new

local and international retailers to

modernize shopping complexes and

address customers’ demand.

>> Marketing activit ies to attract

targeted customers, increase sales

volumes, and give customers

rewarding experiences. CPN, based

on its market survey, focuses on

joint sales promotions conducted

with department stores, Central

Group businesses, and allied retail

shops to create superior value.

As for events, the emphasis is

on outstanding signature events

that create memorable shopping

experiences. All these are effi ciently

communicated via diff erent channels.

>> Service and facility management

(including that of toilets, parking,

public relations counters): CPN

focuses on personnel development,

enhancing quality of services and

facilities on a par with international

standards, and application of

advanced technologies to maximize

customers’ satisfaction and lower

operating costs.

3. Strategy for Development to Sustainability

>> Development of human capital

and organization: CPN emphasizes

development of human capital

to be prepared to accommodate

future growth through CPN’s talent

management program. The program

defi nes recruitment processes and

skill development and enhances

leadership potential by using

integrated development mechanisms

of CPN Academy. In addition, CPN

has in place individual career growth

and assessment system development,

and strives to create a sense of

belonging among employees. In

organization development, CPN

promotes corporate core values and

culture, good governance, employer

branding, and good interna l

communication.

>> Information technology and quality

management systems to address

ongoing businesses’ needs. CPN

developed IT systems to effi ciently

support organizational growth. It

has improved work processes and

applied enterprise resource planning

(ERP) to support management as

well as improving its corporate

management system under the

Thailand Quality Award (TQA)

approach.

>> CSR Strategy: CPN focuses on Green

Experience, CPN Volunteer, and CPN

Cultivate Thai Wisdom projects, all

designed to truly address the needs

of communities and society.

Committed to

joint success with partners

CPN stresses its employees’

cordial relations with others

by extending cooperation,

help, support, information,

and wholehearted contribu-

tion to teams or people, both

inside and outside their own

units. Employees should

m a n a g e c o n f l i c t s a n d

creatively resolve problems

with consistent respect for

and honor toward others

so as to maintain friendship

with all parties.

Common characteristics of CPN people >> Think outside the box for creative, more effi cient solutions >> Be assertive

>> Be willing to heed new ideas for work development >> Foster trust and acceptance by others >> Understand the code of

business conduct and treat each other as professionals do >> Be committed to achieving success >> Strive for performance

excellence >> Collaborate for common goal achievement >> Share knowledge and ideas >> Creatively solve problems.

Committed to

creating satisfying experiences

C P N i s c o m m i t t e d t o

ensuring that everyone

exercises their initiatives

and sparks positive ideas,

methods, or innovations

to improve work through

outstanding and unique

performance. Unfamiliar

ideas can be developed and

applied for positive benefit

and impressive outcomes.

Committed to

excellence

CPN focuses on achieve-

ment by all personnel and

their ability to push for

results against goals with

due attention and recogni-

tion of all quality-related

aspects. It also focuses on

professionalism and mastery

of the task at hand, as well

as attention paid to regular

self-improvement to supple-

ment value and support

CPN’s successful achieve-

ment of desired directions

and strategies.

Committed

for trustworthiness

C P N i s c o m m i t t e d t o

cultivating trust and achiev-

ing acceptance by others

through a display of maturity,

credibility, judiciousness,

fa i rness , co l laborat ion,

accountability, and other

act ions taken with due

regard for related parties

and CPN at large.

CORPORATE VALUES

TO BE CONFIDENTLY CREATIVE ANDSTRIVE FOR EXCELLENCE TOGETHER


Established on 17 June 1980, to develop

and manage large-format and integrated

shopping centers, the Company has

been listed on the Stock Exchange of

Thailand (SET) since 1 March 1995. Its

current issued and paid-up share capital is

Baht 2,178,816,000, of which the majority

is held by Central Holdings Co., Ltd.,

and Chirathivat family members. CPN’s

core businesses comprise development

of large-scale shopping complexes and

provision of retail space for rent and

services. At present, CPN manages

18 shopping complexes, owning 15

projects, with three leased out to CPN

Retail Growth Leasehold Property

Fund (“CPNRF”). CPN also runs offi ce,

residential, and hotel buildings as its

supporting business to optimize the

use of land, diversify income sources,

and draw in more customers to

shopping complexes. CPN operates

related businesses, such as water and

recreational parks, and food centers in

some shopping complexes to facilitate

shoppers. Services and facilities pro-

vided at each complex mainly depend

on locations and the needs of target

customers.

CPN’s business falls into various business

groups. Categorized by the source of

income, there are six business groups,

described as follows:

NATURE OF BUSINESS

OVER-30-YEAR EXPERIENCE IN THE PROPERTY DEVELOPMENT

CONTINUOUS

GROWTH FROM

6 BUSINESS GROUPS

18 SHOPPING

CENTERS UNDER

MANAGEMENT

01 Shopping Complexes

CPN’s main source of income, the

shopping complex business generates

over 76% of the total revenue. Income

includes rental of retail spaces, utility, and

security services, apart from cleaning

services at 15 properties. Another source

of income in this category is the

management fee at three property

projects under CPNRF and a share of

profi ts from investment in CPNRF.

According to its estimated data, CPN

earned a 22% market share of the retail

industry in Bangkok (as of 31 December

2011), based on the retail-space size of

its shopping complexes.

CPN’s shopping complex development

starts from fi nding strategic locations,

conducting feasibility studies, controlling

designs and construction, administering

sale, to managing the shopping

complexes after their commercial

opening. Also in the scope of work is

the provision of utilities, together with

security and cleaning services at each

site.

02 Offi ce Buildings

The office building business involves

the development of office buildings

for rent, whereas there is demand for

offi ce space in shopping complex areas.

It was found that the office building

business not only complements that of

the shopping complex, but also added

value to the project. It also enhanced

land usage and efficiency of car park

management. The decision to develop

an offi ce building depends mainly on

supply and demand for office space

at each location. Income from the

business comprises rental of office

space, rental of retail shops in office

buildings, and utility service fees.

CPN’s office building development

starts from conducting feasibility

studies, control l ing designs and

construction, leasing, to managing

the buildings when they come into

operation. Also in the scope of work is

the provision of utilities, together with

security and cleaning services at each

site.

At present, CPN runs seven offi ce towers,

on the premises of CentralPlaza

Lardprao, Centra lP laza P inklao ,

CentralPlaza Bangna, CentralWorld

( T h e O f f i c e s a t C e n t r a lW o r l d ) ,

CentralPlaza Chaengwattana, and

CentralPlaza Grand Rama 9. For offi ce

buildings, CPN owns fi ve projects and

manages two under CPNRF: Pinklao

Tower A and B Office buildings at

CentralPlaza Pinklao Project. Tenants

of office buildings in CentralPlaza

Lardprao, Centra lP laza P inklao ,

CentralPlaza Bangna, CentralPlaza

Chaengwattana, and CentralPlaza Grand

Rama 9 projects are mostly operators of

businesses benefiting from shopping

complexes, such as tutorial schools,

language and music schools, beauty

parlors, and securities brokerage fi rms.

The Offi ces at CentralWorld is diff erent

because it is a grade A offi ce building

located in the heart of the central business

district, so most tenants are leading

businesses, both Thai and foreign, and

multinational companies looking to base

their headquarters there.


06 Food Centers

Food Centers are considered essential to

shopping complexes. They are intended

for providing customers with a wide

variety of economical and ready-to-

serve dishes. CPN earns sizeable income

from the sale of food and beverage in

food centers.

04 Residential Buildings

At present, CPN manages two residential

building projects. One is Langsuan

Colonade, a 50-unit serviced apartment,

and the other is Central City Residence

Condominium, a 12-unit condominium

on the premises of CentralPlaza Bangna.

05 Water Parks & Recreational Parks

Water parks and recreational parks are

supporting businesses for shopping

complexes, adding variety to features

and services of shopping complexes.

Not only can they attract more customers

to shopping complexes, but also bring

happiness to customers and people in

surrounding communities. To make

this happen, the size of land and space

availability in the project are key.

Current projects in this category are

“Leoland Water Park” on the sixth fl oor

of CentralPlaza Bangna and “Central

Park”, a large-scale recreational park on

the premises of CentralPlaza Rama 2,

open to the public and consisting of a

health park, a children playground, an

activity area, and renowned restaurants.

03 Hotels

CPN’s hotels and shopping centers are

located in the same areas since there

is a natural demand that supports the

retail business. This practice adds value

to each project by making the most

use of properties for the maximum

return on investment. Key principles

for consideration of hotel investment

include project location, demand, supply,

surrounding areas, and the project’s

growth potential. The hotel business

comprises guest rooms, seminar rooms,

and convention centers to serve the

growth of the MICE (Meeting Incentive

Convention and Exhibition) industry.

Currently, CPN owns two hotels. One is

the 259-room Centara Hotel Udonthani

(formerly known as Charoensri Grand

Royal Hotel, a part of Charoensri Complex,

acquired by CPN in April 2009) and the

other is Hilton Pattaya Hotel with 302

rooms (situated on top of CentralFestival

Pattaya Beach and open on November

2010). CPN has employed expert hotel

management companies, namely

Central Plaza Hotel Plc and Hilton Hotel

Corporation, to manage Centara Hotel

Udonthani and Hilton Pattaya Hotel

respectively for the maximum benefi t.

Currently, the projects under the management of CPN and its subsidiaries are:

Projects Owned by CPN Shopping Offi ce Hotel Residential Food Complexes Buildings Buildings Centers

CentralPlaza Lardprao • •

CentralPlaza Ramindra •

Central Center Pattaya •

CentralPlaza Chiangmai Airport • •

Langsuan Colonade •

CentralPlaza Bangna • • • •

CentralWorld • •

CentralPlaza Rattanathibet • •

CentralPlaza Chaengwattana • • •

CentralFestival Pattaya Beach • • •

CentralPlaza Udonthani • • •

CentralPlaza Chonburi • •

CentralPlaza Khonkaen • •

CentralPlaza Chiangrai • •

CentralPlaza Phitsanulok • •

CentralPlaza Grand Rama 9 • •

CentralPlaza Pinklao* • • •

CentralPlaza Ratchada-Rama 3** • •

CentralPlaza Rama 2*** • •

Remarks:

* 42% of CPN’s shopping malls and all of the offi ce buildings were subleased to CPNRF from November 2009 to December 2024

** 81% of CPN’s asset was leased to CPNRF from August 2005 to August 2035 (a 30-year lease can be renewed twice)

*** 96% of CPN’s asset was subleased to CPNRF from August 2005 to August 2025


Remarks:* Registered its dissolution on 2 August 2010 and are currently not registered complete liquidation.** The fi rst Paid-up Capital on 17 January 2011, and the second Paid-up Capital on 9 September 2011.

99.99%

99.99%

99.99%

99.99%

99.99%

99.99%

99.99%

99.99%

90.00%

78.13%

99.99%

93.30%

99.93%

99.99%

99.99%

99.94% 100%

100%

100%**

27.80% 100.00% 100.00%

99.99%

10.00%

11.85%

99.99%*

24.99%

75.00%

99.99%

12.00%

Direct12.00%

Indirect3.00%

Central Pattana Plc.

Bangna Central Property Co.,Ltd. Central Play Land Co.,Ltd.

Global Commercial Property Limited.

Central (Shanghai) Management Consulting Co.,Ltd.

Thai BusinessFund 5

Thai Business Fund 4

CPN Retail Growth Leasehold Property Fund

Global Retail Development & Investment Limited.

Ayudhya Agrocity Co.,Ltd.

Siam Retail Development Co.,Ltd.

Central Realty Service Rama 3 Co.,Ltd.

Square Ritz Plaza Co.,Ltd.

CPN City Co.,Ltd.

CPN Complex Co., Ltd.

Central Realty Services Co.,Ltd.

Central Pattana Chiangmai Co.,Ltd.

Langsuan Realty Co.,Ltd.

Central Pattana Rama 3 Co.,Ltd.

Central Pattana Chonburi Co.,Ltd.

Central World Co.,Ltd.

CPN Construction Management Co.,Ltd

CPN Chiengrai Co.,Ltd.

CPN Pattaya Beach Co.,Ltd.

Central Pattana Rattanathibet Co.,Ltd.

Central Pattana Rama 2 Co.,Ltd.

Central Food Avenue Co.,Ltd.

Central Pattana Nine Square Co.,Ltd.

Central Pattana Khon Kaen Co.,Ltd.

CPN Pattaya Beach Hotel Co.,Ltd.

CPN Global Co.,Ltd.

GROUP STRUCTURE OF THE COMPANY AND ITS SUBSIDIARIES

REVENUE STRUCTURE OF THE COMPANY AND ITS SUBSIDIARIES

Type of Business / Operated By % of Year 2011 Year 2010 Year 2009 Year 2008 Year 2007

Shareholding Amount % Amount % Amount % Amount % Amount %

Shopping Centers 10,062 75.6% 9,142 76.7% 9,254 75.7% 7,244 73.9% 6,466 74.3%

> Central Pattana Plc.

> Central Pattana Chiangmai Co.,Ltd. 99.99%

> Bangna Central Property Co.,Ltd. 99.99%

> Central Play Land Co.,Ltd. 99.99%

> Central Pattana Rama 3 Co.,Ltd. 99.99%


> Central Pattana Rattanathibet Co.,Ltd. 99.99%

> CPN Pattaya Beach Co.,Ltd. 99.99%

> Central World Co.,Ltd. 100.00%

> Central Pattana Khon Kaen Co.,Ltd. 78.13%

> Central Pattana Chonburi Co.,Ltd. 99.99%

> Central Pattana Nine Square Co., Ltd. 93.30%

> CPN Chiengrai Co., Ltd. 99.99%

Offi ce Buildings 767 5.8% 655 5.5% 898 7.3% 868 8.9% 809 9.3%

> Central Pattana Plc.



Hotel 465 3.5% 157 1.3% 116 1.0% - - - -


> CPN Pattaya Beach Hotel Co.,Ltd. 99.99%

Residences 18 0.1% 20 0.2% 21 0.2% 24 0.2% 19 0.2%

> Langsuan Realty Co.,Ltd. 99.99%


Water and Recreation Park 6 0.0% 6 0.1% 5 0.0% 7 0.1% 9 0.1%



Food Centers 632 4.7% 550 4.6% 639 5.2% 456 4.7% 378 4.3%

> Central Food Avenue Co.,Ltd. 99.99%

> Central Pattana Chiangmai Co.,Ltd. 99.99%



> Central Pattana Rattanathibet Co.,Ltd. 99.99%


Interest Income 48 0.4% 49 0.4% 27 0.2% 167 1.7% 110 1.3%

Share of Profi ts from Investment in CPNRF 498 3.7% 475 4.0% 451 3.7% 362 3.7% 316 3.6%

Others 815 6.1% 858 7.2% 820 6.7% 972 7.2% 601 6.9%

Total Revenues 13,311 100% 11,912 100% 12,231 100% 9,800 100% 8,709 100%

Remark: Excludes non-recurring items.

CentralWorld

CORPORATE GOVERNANCE

CPN recognizes the significance of good corporate governance in creating sustainable relationships and the best interests between each stakeholder. The Board of Directors have therefore defi ned policies for good corporate governance for the Company since 2004; and the current CPN’s corporate governance principles fully adheres to the Stock Exchange of Thailand’s guideline in 2006 and the Organization for Economic Co-operation & Development (OECD)’s good corporate governance principles, whereby CPN is consistently committed to developing and implementing good corporate governance that is appropriate and meets international standards.

Thus, as at 29 September 2011, CPN has revised and updated its good corporate governance principles and its code of business conduct, both of which conform to the international standards and guidelines set by the United Nation Global Compact (UNGC) as well as follow the ISO 26000 guidelines on corporate social responsibility (CSR) practices which have been adapted for implementation by the Company.

CPN’s Board of Directors, management and employees all have been made aware of these guidelines for ethical and good corporate governance principles and practices and all have signed in the form of acknowledgment and compliance with the code of business conduct and corporate governance principles for

complete compliance to these important guidelines, so as to demonstrate their understanding and intension that they will strictly comply to them. Additionally, CPN has disseminated details of these guidelines within the organization – as part of the orientation for new staff, via e-mail, intranet system, internal newsletters, announcement boards, E-learning program, and the Company’s website (www.cpn.co.th) as well as through various Company activities, in order to continuously foster awareness and participation in all personnel across the organization.

CPN’S CORPORATE GOVERNANCE POLICY

The Company’s sections of corporate governance are :

1. Rights of Shareholders

CPN recognizes the importance of taking good care of the rights of all shareholders, in the following manner :

>> The structure of alliance among CPN, its affi liates, and joint ventures is straightforward, without joint shareholding or cross-shareholding. CPN has no pyramid shareholding structure within the Group. This is in place to ensure shareholders receive full returns on their investments.

>> CPN equitably provides shareholders with basic rights and fair treatment in protecting their rights to hold shares, including the right to purchase, sell, and transfer shares; the right to receive clear and accurate information; the right to attend shareholders’ meetings and vote on significant transactions; the right to elect or terminate directors to manage CPN; the right to set the remuneration for the Board of Directors; the right to appoint and terminate external auditors and set their fees; the right to receive part of CPN’s profi t in the form of dividends; and the right to participate in and to be suffi ciently informed on decisions concerning CPN fundamental changes.

>> Details about the exercise of these rights are distributed via SET’s information disclosure system, with due respect to the equitable and convenient access to information, as well as the right-exercising period.

2. Equitable Treatment of Shareholders

CPN adheres to the principle of aff ording equitable treatment to all shareholders, with non-discrimination, whether major or minor shareholders, institutional or foreign investors. Practical guidelines to promote genuine equality include the following :


>> CPN has put in place internal regula-tions to prevent the abuse of inside information and confl icts of interest. Relevant details appear under “Monitoring of Inside Information” on page 90.

>> Transactions with possible confl icts of interest must be submitted to the Audit Committee for their review and comments before submission to the Board and shareholders’ meetings for approval, if applicable. CPN discloses complete and important information under the stipulated regulation. Relevant details appear under “Monitoring of Conflicts of Interest” on page 91.

>> Acting in accordance with the principle and guidelines on affording equal treatment to all shareholders during shareholders’ meetings as per following details :

The 2011 Annual General Meeting of Shareholders (AGM) :

CPN recognizes the importance of giving the exact same rights of shareholders and affording equal treatment to all shareholders, whereby the relevant guidelines have been adopted for actual actions (prior to, during and afterwards) in holding all shareholders’ meetings.

The 2011 AGM was held on 29 April 2011, at 14.00 hours at the Lotus 1-4 rooms, 22nd fl oor, The Centara Grand

Hotel and Bangkok Convention Centre at CentralWorld, 999/99 Rama 1 Road, Patumwan, Bangkok. A total of 582 shareholders attended the AGM in person or represented by thei r authorized proxies (equal to 81.66% of all shares issues) together with 11 (of the 12) directors (equal to 91.67% of the Board of Directors) which included : The Chairman of the Board of Directors, the Chairman of the Audit Committee, the Chairman of the Nomination and Remuneration Committee, the Chairman of the Risk Management Committee, the President & CEO, the Chief Financial Officer, and the external auditors of the Company. Details of the AGM proceedings are as follows :

Prior to the Meeting

>> CPN provided minority shareholders with the right to propose in advance additional meeting agenda items and nominated directors from 28 September 2010, to 14 January 2011. This included shareholders’ rights to query the meeting agenda before the meeting date by submitting their queries to the Company Secretary. Criteria for such consideration, which were agreed upon by the Board, can be viewed at the Company’s website. However, in 2011, no shareholder has proposed any name or agenda item for consideration.

>> CPN prepares the meeting notice in both Thai and English. For the 2011 AGM, the meeting notice was posted on the Company’s website on 24 March 2011, 30 days ahead of the meeting date, and was distributed to shareholders 21 days ahead of the meeting date. This provided shareholders with enough time to examine the information.

>> In the notice, CPN enclosed essential and adequate facts and rationales, as well as directors’ comments for all items on the agenda for shareholders’ consideration. The Annual General Meeting of Shareholders (AGM) agenda comprises :

1. Nomination of Directors : CPN provides basic information on candidates, including name, age, type of directorship, education, director training courses attended, experience, holding positions in other businesses, number of years in each position, and participation in committees’ meetings as member of such committees during the previous year, share holding in other companies and other information such as any confl ict of interest incurred in the previous year.

2. Remuneration : CPN provides information on the policy, amount, and form of remunerat ion according to each director’s

position and responsibil i ty, criteria and the procedures for determining compensation.

3. Appointment of External Auditors : CPN provides information on the names of auditors and their affi liation, auditors’ independence, the number of service years with the audit company for consideration of the suitability of the auditors’ fee.

4. Dividend Payment : CPN provides information on the dividend policy and dividend amount subjected to approval, in comparison with the amount paid in the previous year.

>> There was no signifi cant, extraordinary document distributed at the meeting, no addition items added to the meeting agenda, and no amendments made to significant information without informing the shareholders in advance.

>> CPN facilitates shareholders who cannot attend the meeting themselves by enclosing in the meeting notice Proxy Form B, on which shareholders can state their voting preference, together with details about how to appoint a proxy to shareholders’ m e e t i n g s . S h a r e h o l d e r s c a n download Proxy Forms A, B, and C from www.cpn.co.th. In addition, the names and profi les of the four independent directors are provided

for shareholders’ voting by proxy. At the 2011 AGM, 120 shareholders appointed independent directors as their proxies. Details are as follows :> 75 shareholders appointed

Mr.Paitoon Taveebhol, Chairman of the Audit Committee.

> 34 shareholders appointed Mrs.Sunandha Tulayadhan, member of the Audit Committee.

> 7 shareholders appointed Mr.Chackchai Panichapat, member of the Audit Committee.

> 4 shareholders appointed Mr.Karun Kittisataporn, member of the Audit Committee.

During the Meeting

>> CPN provided at least a two-hour registration period before each meeting. A computerized barcode system eased registration and vote counting to speed up the process and ensure information accuracy and reliability.

>> CPN provides shareholders with voting rights equivalent to the number of shares held. One share yields one vote.

>> Before the shareholders’ meeting, the Company must inform shareholders of the vote-tallying procedures.

>> CPN introduced the use of ballots for casting votes. The ballots were prepared separately for each agenda

item for shareholders to use as seen appropriate.

>> Participants were informed of the voting result for each agenda item and presented with the voting scores.

>> CPN transparently conducted the AGM by following the respective agenda items as stated in the meeting notice, in strict conformance to the laws and the Company’s regulations. Re p r e s e n t a t i v e s f r o m K P M G Phoomchai Audit Limited were invited to observe the meeting.

>> Shareholders were allowed to attend a meeting in progress and to vote on remaining items of the agenda.

>> The Company allowed shareholders to fully express their views and to raise their questions at the meeting. The Chairman of the Board, the Chairman of the Audit Committee, the Chairman of the Nomination and Remuneration Committee, the President & CEO, the executive management, and external auditor attended the meeting to clearly answer all aspects of shareholders’ questions.

After the Meeting

>> CPN submits the resolutions of every shareholders’ meeting through SET’s information disclosure system on the same day, so that non-attending share-holders are immediately informed.


>> Shareholders can also view a webcast of the AGM via the Company’s website or request for a video recording of each meeting from the Company Secretary.

>> Minutes of each shareholders’ meeting are disseminated through the Company’s website within 14 days after the meeting date, with a copy sent to SET within the stipulated period.

>> Shareholders’ opinions on the organizing of shareholders’ meeting were obtained through the satisfaction questionnaires. The information acquired was then applied in improving the efficiency of future shareholders’ meetings.

In 2011, CPN received CPN received a score of 100 on quality assessment, under the AGM quality assessment project, jointly conducted by the Thai Investors Association, the Securities and Exchange Commission (SEC), and the Thai Listed Companies Association. The assessment criteria included steps undertaken before each shareholders’ meeting and activities on the meeting date and afterward.

3. Roles of Stakeholders

CPN values all stakeholders and observes the sustainability of common benefi ts, in 2011, CPN has clearly set its policies and

roles toward stakeholders in its “Code of Business Conduct for stakeholders”, to which it has also added government and independent organizations and other related social organizations, as detailed below :

>> Shareholders : Stimulate growth with quality and stability for the shareholders’ sustainable benefit with good and effi cient performance; respect the shareholders’ equal rights to receive necessary information; disclose correct and actual information; conduct business based on honesty, transparency, and fairness. Relevant details appear under “Rights of Shareholders and Equitable Treatment of Shareholders” on page 79.

>> Tenants and Customers : Satisfy the customers with good service, fair, and proper treatment of customers, according to safety on health, life, and property; provide complete, correct, and actual information; undertake customer satisfaction surveys, the results of which are used to continuously improve the service. These activities are described below :

1. M a n a g i n g a n d p r o v i d i n g standardized services to tenants under the supervision of the Standard Promotion and Control Unit (SCU). The activities run by SCU included the standardization of policies, work processes related to tenants at all branches, and

public information of the services provided by CPN.

2. Developing of service staff and evaluation of their services, including tenant relations staff s’ daily visits to each store to serve tenants and listen to their problems and complaints. Customer service staff are also assigned to walk around shopping areas inside every center to handle shoppers’ questions or promptly provide recommendations, thereby saving them a trip to the PR counter.

3. Meeting and communicating any signifi cant operational plans with tenants at least once a year, including meeting with the tenants when opening or renovating any CPN’s shopping complex, in order to announce its policies and to plan any joint marketing activities. Furthermore, these meetings provide an opportunity for tenants to express their opinions and make any recommendations for continuous service improvement.

4. Jointly developing plans with tenants such as organizing activities on assorted occasions, including shop openings, new product launches, business partnerships, and joint sales promotions between retail shops and the shopping complex to enhance shop owners’ preparedness in running their businesses.

5. Undertaking satisfaction surveys relating to the services provided to tenants and customers on an annual basis, in order to be informed and aware of any tenants and customers’ needs as well as to improve CPN’s excellence in services.

6. P r o v i d i n g c o m m u n i c a t i o n channels for customers to receive business information and to voice complaints, including direct contact with tenant service offi cers at each branch, I - Box, Company website and CPN Call Center at +66(0) 2635–1111, etc.

7. Conducting focus groups to learn the specifi c needs of each tenant group and assessing the outcomes for service improvement.

8. Recognizing the importance of developing public relations media by not using images or contents that may cause negative attitudes, social division, or improper values, especially those about sex or immorality, in the company’s sales campaigns.

9. Overseeing that the environment, the area inside and around the property under the company’s management, is safe for health, life, and property.

>> Business partners : Provide fair

treatment of business partners based on joint benefi t; create and maintain sustainable relationship with business partners; create trust, by which the company adheres to the clear procurement procedures and practices, including cooperation in economy, society, and the environment.

>> Creditors : Strictly respect agreements with creditors; manage the loans according to the objective of expenses; abstain from using the loans in the way that may cause damage to the company; ensure timely repayment of loans and interests; thoroughly honor loan conditions as agreed.

>> Employees : Provide fair and proper treatment of employees whether in opportunity, remuneration, appointment, transfer, or potential development; monitor the workplace for the safety of employees’ life and property; provide channels for employees to express their views and suggestions, as well as fair treatment and non-discrimination of all employees. Relevant details appear under “Human Capital Management” on page 96.

In addition, CPN encourages dialogue between the company and the employees or representatives of the employees to present information to the company’s decision-makers so as to improve the quality of the workplace in view of joint development.

>> Business competitors : Conduct business with fairness; refrain from improperly seeking competitors’ confi dential information; refrain from abusing the intellectual property rights of others or those of competitors; promote exchange of information useful to the overall development and management of shopping complexes so as to strengthen the business and help sustain the economy, society, the environment, and the country.

The establishment of Thai Shopping Center Association is one instance of close cooperation and collaboration between CPN and industry peers, with the aim of exchanging helpful knowledge and experience in con-ducting business for mutual benefi t; whereby, in 2011, joint discussions included :

1. Following up on the status and progress of Draft Retail and Wholesale Business Act; and seeking the collaboration in the event that this proposed law comes into eff ect.

2. Exploring the possibil i ty of submitting recommendations to amend the laws and regulations on safety and standards of cleanliness to be maintained within shopping complexes – such as, providing a specifi c area for smoking.


3. Exploring ways to be well-prepared for the impending establishment of the ASEAN Economic Community (AEC) in 2015, as well as making an assessment of the overall regional retai l business competi t ive environment.

4. Sharing and exchanging of experiences in regard to the environment protection such as energy saving measures for use in buildings and shopping complexes through the use of eff ective alternative energy.

5. Promoting the expansion of close cooperation among its members in other ways such as field visits under the auspices of the Association to study the operations of oversea shopping complexes.

6. Organizing activities in creating re l a t i o n s h i p s b e t we e n t h e members of the Association.

>> Society, communities, and environ-ment : Respect the relevant law, and/or regulations and try to upgrade the implementation to be of higher standard than specifi ed by law, such as researching and making use of innovative energy saving building technologies in the shopping complexes and office building; monitor the operation of the company and prevent it from damaging the quality of life of society, communities,

and the environment; develop society in its quality of life, education, energy saving, and environmental protection for the benefit of society at large. Additionally, CPN also focuses on the importance of communicating as well as disseminating valuable information and knowledge to all involved stakeholders with regard to the environment, so as to establish a collaborative network in taking good care of and protecting the e n v i r o n m e n t ; a s w e l l a s i n broadcasting such knowledge to all sectors of the society. Relevant details appear under “Sustainability Management” on page 102.

>> Government : Cooperate and support government policies for the benefi t of the country under relevant law and criteria; manage projects that are benefi cial to the public, whether as assigned by the government or company-initiated projects.

>> Independent organizations and other related social organizations : Upgrade cooperation and exchange information with independent organizations and other related social organizations for the joint development of society and the country on a sustainable basis, taking into account impact(s) on the economy, society, and the environment.

Anti-Corruption Practices

On 9 November 2010, CPN stated its position with regard to the “Collective Action Coalition” on anti-corruption practices, the collaboration jointly arranged by the Thai Institute of Directors Association (IOD), the Thai Chamber of Commerce, the International Chamber of Commerce, the Thai Listed Companies Association, and the Thai Bankers’ Association. Additionally, the Board of Directors has set the policy against fraud and corruption and has commu-nicated this to the management and all employees. There has also been the exchange of knowledge, experience with the government, private sectors, and stakeholders.

Cooperating in the National post-fl ood Rehabilitation

CPN, in the name of the Central Group, has been a leading organization among the group of 12 private sector companies in establishing the “Power of Thai” project that was also supported by an associated network of 40 other organizations, which collected funds for use in rehabilitating various aspects of the Thai educational system and infrastructure impacted by the extensive fl ood crisis of 2011, whereby assistance was given in rebuilding school facilities, in donating educational materials to replace those damaged by the fl oods, as well as in off ering fi nancial assistance to those teachers and students

affected by the flooding under the auspices of “Power of Thai Fund”. A total of 84 schools located in 17 provinces were included and received assistance from this project.

In 2011, CPN has compiled various practices continuously adhered by its employees and set them as written policies to make clarifi cation, recognition, and implementation for all stakeholders such as :

Policy on intellectual properties

CPN must conduct business and encourage employees to obey the law or regulations on intellectual property rights, whether in trademarks, patents, copyrights, commercial secrets, or other intellectual properties as stipulated by law such as using only legal and licensed software, whereby all applications software used must be inspected and installed only by the Information and Technology Department; encourage employees to ensure that the application of the fi ndings of research or information in their work respects others’ intellectual property rights.

Policy on respect of law and principles of human rights

CPN promotes and respects the protection of human rights, and ensure that the company’s business is in line with human rights concerning forced labor or child

labor; respect and provide fair treatment to all stakeholders based on fairness, human dignity, non-discrimination of origin, race, gender, age, skin color, religion, physical state, status, or birth; promote compliance with human rights within the company and encourage subsidiary companies, investors, business partners, and all stakeholders to observe the international standards of the principles of human rights; and protect the rights of stakeholders aff ected by the violation of their rights as a result of the company’s operation by considering compensation no lower than the rate stipulated by law, etc.

Policy against fraud and corruption

CPN prepares communication channels for employees and related persons to report dishonest or illegal practices; measure for giving or receiving gifts, assets, or other benefits, receptions, or excessive expenses that are out of line with the company’s criteria; procurement practices; and donation that must be based on transparency and compliance with relevant law.

Details of the abovementioned policies and other important policies appear in the ”Code of Conduct and Corporate Governance Principles”, while important details on treatment of stakeholders appear under “Sustainability Management” on page 102.

Whistle-blowing and Complaints

CPN has set up a Committee responsible for reviewing and investigating any complaints or information, and has given clear assignment of roles and responsibilities and procedures to deal with such situations with transparency, and accountability to ensure that the whistleblowers can fully trust and have confi dence in this process.

Should employees or stakeholders suspect any unlawful activities or those in violation of the law, rules, regulations, code of business conduct, they can undertake whistle-blowing or fi le complaints with detailed evidence to the Company’s Audit Committee, which will then proceed to seek further information and investigate the factual revelation, and propose its fi ndings to the Board of Directors for acknowledgement and further consideration. Details of communication channel are as follows :

Audit CommitteeCentral Pattana Public Company Limited30th fl oor, The Offi ces at CentralWorld 999/9 Rama 1 Road, PatumwanBangkok 10330Tel : +66(0) 2667 5555 ext. 1200Email : [email protected]

The rights of whistleblowers who are employees, temporary employees, and outsourced persons shall be protected as stipulated by law. Relevant details appear


in “Code of Conduct and Corporate Governance Principles”

In 2011, the Company was engaged in no signifi cant dispute with any stakeholders.

4. Disclosure and Transparency

CPN emphasizes on correct, complete, transparent, thorough, and timely disclosure of information, whether financial or non-financial, so that investors and all stakeholders may regularly receive reliable and suffi cient information for their decision. Disclosure of such information includes :

>> The Company’s important and timely information and news through various communication channels such as the Company’s website, the Stock Exchange of Thailand’s information disclosure system, quarterly reports, business action plans, and annual reports.

>> Form 56-1, Annual Report (Form 56-2) , f inancia l informat ion, information on major shareholders and voting rights, information of directors and members of sub-committees, information sent to the Stock Exchange of Thailand, dividend pol icy, code of conduct and corporate governance principles, and company activities and action plans.

Responsible persons for disclosure of information

CPN has assigned specific persons responsible for disclosing the Company’s important information, comprising the President & CEO, the Company Secretary, top executives responsible for fi nance and investor relations, including top executives responsible for marketing and public relations unit, whereby they are responsible for disclosing information only related to their respective areas of responsibility.

IR Disclosure and Transparency

CPN highly values disclosure of information by consistently adhering to the principle of transparency, fairness, completeness , promptness , and accuracy of a uniform direction. This is regarded as the key factor for obtaining trust and confi dence of shareholders, investors, and stakeholders, such as Stock Exchange of Thailand (SET), Securities and Exchange Commission (SEC), and credit-rating agencies. CPN is well aware that its fi nancial and non-fi nancial information aff ects the decision of shareholders and investors. Moreover, transparent disclosure of information is the supporting factor that adds value to the Company in the long term.

Investor Relations

CPN established an Investor Relations Division in 2006 as the center for

handling enquiries, disclosing the Company’s information, and managing relations with investors, analysts, shareholders, and the general public. Investor Relations works closely with senior executives to formulate policies as well as quarterly and annual plans, including operational guidelines and approaches for developing CPN Investor Relations practices on a par with leading regional listed companies. The division also presents performance results and comments from shareholders, analysts, and investors to the Board twice a year.

CPN discloses complete, accurate corporate and financial information through the following channels:

1. Form 56-1 and the Annual Report (Form 56-2) provide detai led information on significant topics, including business overviews, r isk factors , capita l s t ructure and management , connected transactions, management of inside information, corporate governance, financial status and performance, and future projects.

2. The Management Discussion and Analysis (MD&A) quarterly and annual reports, which provide detailed operation and fi nancial information, including analysis and explanations of factors causing changes in performance results, progress reports of projects under development, key

factors or infl uences that may aff ect future results and financial status. This report provides shareholders and investors with enough accurate information for their decision-making on investment and monitoring of the Company’s performance.

3. CPN discloses its information via the www.cpn.co.th website under “Investor Relations” to facilitate investors’ and the interested public’s study of its information. The website, available in both Thai and English, has been regularly updated. Investor Relations discloses information, such as financial information, MD&A, shareholding structure, corporate governance, company information submitted to SET through its ELCID system, Annual Report, Form 56-1, notices to shareholders’ meetings, minutes of shareholders’ meetings, press releases and photo releases, investor relations calendar (IR Event and Calendar), factsheets for existing and new projects, and presentations used during both domestic and international roadshows by senior executives. The website received over 9,200 visitors a month, with over 250,000 viewings of the webpage information a month (25% higher than last year). Furthermore, over 3,200 people subscribed to Investor Relations’ electronic newsletters.

Quarterly Meetings with Shareholders and Investors

CPN has joined SET in organizing quarterly “Opportunity Day” activities so that its senior executives may present the Company’s quarterly reports on performance results and explain business progress, such as expansion projects, new projects, business trends, and how to deal with positive and negative eff ects caused by internal and external factors. This is a good opportunity for executives to meet and answer the questions from analysts, investors, and shareholders in person. In each quarter this year, an average of 80 – 120 investors and the interested public participated. SET also provides a live webcast via SET’s website, with a quarterly average of 80 persons following the activity via this channel. Computer monitors are set up in front of CPN executives so that the viewers can post their questions and get real-time responses from the management during Q&A sessions. Furthermore, visual and audio recordings of executives’ presentations are provided through a webcast system and posted on the CPN website to ensure that the Company’s quarterly performance is comprehensively disseminated to investors who did not participate.

Meeting Investors

CPN regularly hosted a variety of investor-meeting activities to ensure that

senior executives and Investor Relations meet investors and explain specific information on performance, strategic plans, guidelines on business growth, and a summary of major events in 2011, including answering questions. This year these activities included:

1. Hosting roadshows, which were divided into: > 11 overseas roadshows > Three domestic roadshows.

2. Hosting 52 company visits to enable analysts, as well as Thai and foreign retail and institutional investors, to meet CPN’s senior executives and investor relations specialists to, via prior appointments, acquire Company information.

3. Via prior appointments, hosting eight site visits for investors and securities analysts. This year, CPN, in cooperation with securities companies took foreign and Thai investors to visit the Company’s shopping centers under CPN’s management, where they appreciated b u s i n e s s o p e r a t i o n t h r o u g h presentations from executives.

4. Holding 10 conference calls with investors.

5. Communicating information via email and telephone 3-5 times per day.


CPN hopes that the Investor Relations Division will continue to serve as the center for disseminating information, handling enquiries, and regularly receiving and exchanging shareholders’ or investors’ opinions. Shareholders, investors, and interested parties may contact the Company for additional information through:

Ms. Choenporn SubhadhiraInvestor Relations DivisionCentral Pattana Public Company Limited31st Floor, The Offi ces at CentralWorld999/9 Rama I Road, PatumwanBangkok 10330, ThailandTel: +66(0) 2667 5555 ext. 1614 or 1669Fax: +66(0) 2264 5593E-mail: [email protected]

5. Board Responsibilities

The Board of Directors participate in setting the direction for the growth and development of CPN, through determining the strategies and policies and giving advice and recommendations, as well as in directing, overseeing, and monitoring the status and progress of the various operational aspects of the Company on a regular basis. During 2011, the Board of Directors acted and discharged their responsibilities in the following manner :

>> At the Board meeting No. 6/2011 on 29 September 2011, the Board approved the revision and amend-ment to the ‘Code of Conducts” and “Corporate Governance Principles”, so as to ensure that the required business ethics and good corporate governance corresponds with the current economic situation as well as social and business environment, whereby all directors, management and staff of CPN were required to sign in the form of acknowledgment and compliance with the code of business conduct and corporate governance principles.

>> The Board of Directors consists of four independent directors out of a total of 12, accounting for one-third of the total. Being fully qualified under the Company’s standard, the independent directors can eff ectively and effi ciently perform their duties for the full benefi t of the Company.

>> The Chairman, who is not an inde-pendent director, is a representative of the shareholders. Based on the deliberation of the Nomination and Remuneration Committee, and with the approval of the Board, the current structure is appropriate for CPN’s business and is a forte supporting CPN’s constant success and business growth, as the Chairman is know-ledgeable, experienced, skillful in the retail and property development

industries, and adheres to the principles of good governance.

Policy on limiting the number of companies and the term of director-ship for directors and president

>> A director must not serve on more than five listed companies on the SET, without exception. Currently, this requirement is the case.

>> Each independent director cannot hold more than two consecutive terms of directorship, with one term extendable if seen appropriate. The Board considers such a flexible policy appropriate due to the time-consuming process in nominating a qualifi ed independent director.

>> The president may hold directorships in another company, but such action must not affect the work as the Company’s president and must not be in the same business or in competition with the Company. Approval of the board must fi rst be sought before accepting directorship in another company. Currently, the president of CPN is not a director of any listed company other than CPN.

Board meetings

>> The Board jointly plans meeting dates for the entire year in advance, with at least six meetings a year. In 2011, there were seven Board meetings,

consisting of six regular meetings and one extraordinary meeting, consisting of a total of 45 agenda items for consideration and 36 agenda items for acknowledgement.

>> The Chairman, the President and the Company Secretary jointly set a clear agenda before each Board meeting. All directors can freely propose their agenda items for consideration by the Chairman before inclusion in a meeting.

>> The Company Secretary must submit meeting documents that can be revealed in written form without aff ecting CPN’s business operations to the directors at least seven days in advance for consideration, together with invitation letters specifying the meeting date, time, place and agenda. In emergencies, to protect the Company’s rights or interests, appointments for such meetings can be made through other methods at shorter notice.

>> During each meeting, the Chairman allocates enough time for discussion of each significant issue and encourages all directors to creatively and freely express ideas with due discretion, with the Company Secretary and legal department in attendance to take notes.

>> Director who has a vested interest in the agenda item must abstain

from the meeting and voting on the particular agenda item.

>> In the event that a situation occurs that is critically important or that may have a signifi cant impact on the Company and/or for any signifi cant stakeholders, management will submit full details of the incident to the Board for consideration, comment and its opinion as well as to seek any advice – for example, during 2011 a fl ood crisis that occurred in many provinces and the immediate suburban areas of Greater Bangkok where many CPN’s properties and shopping complexes are located, whereby the Board of Directors considered these various relevant facts and had these comments, questions, and advice :

> acknowledged the preparations and contingency plans to protect the facilities against the flood, together with a situation summary for each property or shopping complex as well as plans to avoid any interruptions to business activities,

> planned actions to avoid or protect the properties from the fl ood in the future,

> the impact on CPN both fi nancial and non-fi nancial,

> insurance coverage,> communications of information

to all concerned and involved,

> off er of assistance to those aff ected by the fl ood – i.e. staff , customers, and the immediate communities – in a equitable and comprehensive manner, including flood relief activities, in general, to help all those aff ected by the fl ood.

>> Minutes of Board meetings, all relevant information and documents are safely stored in the form of electronic fi les and the original documents.

>> In the event that there are questions requiring follow-up and/or additional information from any involved department, the Company Secretary will coordinate and submit the additional details/information to the members of the Board of Directors as quickly as possible.

>> The Company Secretary must submit monthly reports, comparing achievements against the Board-approved targets, for the directors’ acknowledgment.

>> Non-executive directors are required to hold at least one exclusive meeting a year. In 2011, the meetings was held in February and July. A summary of issues and recommendations from the meeting was acknowledged by the Board of Directors and the management for further improve-ment of the Company.

>> The effi ciency of Board Meeting is evaluated at every Board meeting to


promote constant improvement of directors’ performance and meeting arrangement; whereby the outcomes of such evaluations for 2011 scored an average of 94.21% compared to 91.91 % in 2010.

>> The Board also conducts self-evaluation annually. The combined outcomes of these evaluations for 2011 scored an average of 97.88% compared to 95.50% in 2010. Additionally, the Board also gave their observations on how to develop and improve the role of Board members and discharge of responsibilities by the Board, on how to further develop the organization, on business strategies and plans, and on the corporate risk management.

>> The Board also evaluates the performance of the President & CEO, using an evaluation form consisting of 2 key components : measuring the operational performance of the President & CEO and the further career development of the President & CEO; whereby the President & CEO also participate in setting of goals and business targets and acknowledges those targets that have been approved for the year. The evaluation results will be provided to the Nomination and Remuneration Committee to use in determining and making a subsequent recommendation to the Board for consideration and approval,

the proposed future remuneration for the President & CEO.

>> The Board also considers any changes in the relevant laws, rules and regulations that are of importance to the Company, together with any news and updates relating to good corporate governance practices guideline on a regular basis, so that ongoing activities of the Board will fully comply to any revised and relevant laws, as well as rules, regulations and guidelines currently in eff ect.

Training and Seminars of the Board of Directors

The Company Secretary has supported the Board in regard to increasing their knowledge and the exchanging of knowledge and experiences on a continuing basis in the discharge of their responsibilities as a member of the Board and/or sub-committees, through communicating to them as well as coordinating and facilitating them to be able to be aware of and/or attend various seminars and training courses dedicated to directors. Details of attendance at seminars and participation in any directors training courses appear under ”Management Biography” on page 238.

Directors , Management and Employees’ Disclosure of Informa-tion; and Management of Confl icts of Interest

Monitoring of inside information

The directors formulate a policy to monitor the use of inside information and the Company’s stock transactions on the basis of equality and fairness of all shareholders and for the prevention of relevant directors and executives from undertaking dishonest stock transactions for their own benefit or the benefi t of others.

>> Control of inside information : The directors, executives, and all employees are prohibited from using the Company’s material and undisclosed information to the public for their own benefi t or the benefi t of others and must strictly adhere to the policy on keeping and using inside information as specifi ed by the Company.

>> The Company’s stocks : The directors, the executives, and employees are entitled to invest in the company’s stock transactions. However, to prevent conflicts of interest, the directors, executives, and employees, as well as their spouses and children under the legal age, are prohibited from buying, selling, transferring, or accepting transfer of the Company’s stocks one month before the disclosure of the financial statements to the public.

If the directors, the executives, and employees, as well as their spouses and children under the legal age, buy, sell, transfer, or accept transfer of the company’s stocks, they must prepare and report a list of stocks and a change in the company’s shareholding to the monitoring agency as specifi ed.

If the executives and the employees violate the corporate governance principles on the use of inside information, they will be considered guilty of the company’s rules and may be punished by law.

>> Disclosure of holding CPN shares : The Company Secretary is required to fi le a quarterly report on shareholding of directors and executives and submit it to the Board.

Monitoring of confl icts of interest

It is the Company’s policy to conduct business with honesty, open-mindedness, transparency, and fairness. The Company forbids its directors, executives, and employees to compete with the Company, avoid making connected transactions relating to them or people/entities that may cause conflicts of interest with the Company. The board ensures that the Company strictly performs duties according to criteria, method, and disclosure of connected transactions as specifi ed by law or the monitoring agency.

If it is necessary to undertake connected transactions, they must be in line with general business conditions as specifi ed and approved by the Board, based on transparency and fairness, as if the transactions were undertaken with other parties, taking into account the Company’s maximum benefit. Stakeholders with confl icts of interest are forbidden to take part in the consideration of connected transactions. If the connected transactions are not in line with general business conditions as specifi ed and approved by the Board and may cause confl icts of interest, the transaction must be submitted to the Audit Committee for opinions before submitting to the board or shareholders for approval.

>> Disclosure of connected transactions : The Directors and the executives must fill out a form of connected transactions in each fi scal year ended 31December to express transparency, thoroughness and discretion in deliberating connected transactions during the year. The Company Secretary is responsible in providing and collecting such information.

>> Disclosure of information on the involvement of directors, executives, and related parties : The fi rst report must be submitted within 30 days of their first service date with the Company, and the information must be reported on 31 December of every year. For the sake of transparent

transaction, if directors, executives, and related parties must directly or indirectly conduct any transactions with the Company or its subsidiaries during the year, such directors or executives must notify the Company at once by identifying facts about the nature of each contract, names of counterparties, and their involvement in the contract.

>> Disclosure of vested interests : The directors and the executives are responsible for disclosing vested interests held by themselves and relevant people that may relate to the Company’s management according to the rules, conditions, and methods of the Capital Market Supervisory Board. The Company Secretary is responsible for compiling and submitting a copy of the report of such interests to the chairman and the chairman of the Audit Committee within seven days after receiving the report.

In 2011, it has not any complaint about dishonesty of directors and executives about the misuse of inside information.


Organizational Realignment

Working with its consultant, CPN

conducted a study on organizational

restructuring in line with and in support

of business expansion. It focused on

grouping work and adjusting work

groups to enhance the effi ciency under

a new structure. Based on main tasks,

operation was divided into development,

domestic project management, overseas

project management, and planning,

policy, and support.

The new structure promoted more

harmonious collaboration among each

division in the Company, based on the

same work standards. CPN focused

on developing the expertise of each

division while reducing duplicate work

procedures so as to streamline customer

service. It assigned knowledgeable and

capable people who were suitable for

each position and provided them with

training and a coaching process to

help them adjust their work to the new

structure.

Development of Corporate Infrastructure through ERP and HRIS

CPN restructured in parallel with the

“F1 Project”, which developed an IT

system for the management by applying

the Enterprise Resource Planning

(“ERP”) system to ensure more fl exibility

and efficiency. Furthermore, it would

reduce non-value added jobs so that

staff might earn more time to improve

their capability and have a chance to

express their talents for creating more

innovations.

> F1 Project

was collaborated on by representatives

from different divisions of CPN

and a consultant with expertise

and experience in developing IT

management systems for the world’s

leading corporations. This project

developed a specific, suitable IT

s y s t e m w h i c h c o m b i n e d t h e

knowledge of operation, business

conduct, and international standard

management. The project is scheduled

to be completed and put on trial in the

third quarter of 2012.

> Human Resources Information

System (HRIS)

developed tools for human resource

management in manpower planning,

personnel recruitment, personnel

management and development, and

development of staff databases to

ensure that the staff might eff ectively

ORGANIZATION DEVELOPMENT

To enhance the Company’s capability and drive it toward the “To be the most admired and dynamic regional retail property developer with world-class rewarding experience” vision, CPN has strengthened its organization structure to support expanding domestic and overseas branches and improved work processes for more effi ciency while getting better equipped with IT data to ease the management and decision-making processes. CPN also designated each position’s work scope, role, and responsibility to make sure that it supported one another and was customer-oriented. The work culture must suit CPN’s ambition to become a regional organization under the so-called Transformation Mission (T-Mission). It is CPN people’s collaboration in adjusting work processes, roles and responsibilities to reinforce the organization structure that supports its becoming a regional retail developer and manager.

apply them. After the completion of

the HRIS project, staff can work and

conduct transactions via different

systems by themselves as self-service,

such as checking their personal data,

work periods, requesting approvals for

leave, and welfare.

This year, CPN established a CPN

Academy personnel development

center to formulate strategies for

developing all staff , annual development

and training programs, executive

development programs, new staff

development programs, and retail

d e ve l o p m e n t a n d m a n a g e m e n t

programs. The learning ski l l of

members in the organization were

also encouraged in “Share More, Learn

More” and media, such as e-learning

and video-presentations.

Promotion of Value, Culture, and Corporate Governance, including Staff ’s Volunteer Spirit for the Community and Society

Under CPN’s policy to conduct business

with ethics and virtue, CPN encourages

all management and employees to

perform their duties under six corporate

governance principles, namely “Integrity,

Transparency, Fairness, Equality, Keeping

Promises, and Caring for Society”, in

parallel with CPN’s core value of “To

be confidently creative and strive for

excellence together”. These translate

into policies, operating guidelines,

activities, and campaigns, such as a

corporate governance orientation for

new employees, inclusion of corporate

governance principles on the monthly

meeting agenda, a contest on the core

value, “CPN Volunteer” projects for

staff ’s community and social services

(please see details under “Sustainability

Management”), an employee opinion

survey (EOS), voicing of their opinions via

P.O. Box 99 and the idea-BOX, the Voice

of Internal Customer (VoIC), and the

“Khon Dee, Khon CPN” Award project for

employee role models. Firmly committed

to corporate governance principles

from executive to operational levels,

CPN was recognized for its excellent

corporate governance (fi ve stars) by Thai

Institute of Directors Association (IOD).

To be a Learning and Innovative Organization

> “CPN Share More, Learn More”

To be a learning organization with

knowledge-sharing between executives

and staff, as well as among staff

members, CPN has encouraged every

unit to regularly organize activities

under the “Share More, Learn More”

project to share knowledge, experience,

and good stories of the organization.

More important, people with the same

interests could share knowledge in

a family-like ambience. In addition,

CPN hosts “CPN Radio—Boots up

Your Life, Brightens up Your Health”,

a short radio program with useful

information and relaxing music during

offi ce hours. This activity relaxes staff

while providing them with news and

knowledge.

> “Dream Team”

Besides individual creativity, CPN

promotes teamwork under the PDCA

(Plan-Do-Check-Action), framework,

a tool that trains staff to systematically

analyze and solve problems. The

“Dream Team” Project, initiated in

2009, has been operated annually.

This is a remarkable success, proved

by continuous work improvement.

This year, CPN had more than 90

Dream Teams to improve the effi ciency

of internal functions.

> “CPN Quality Award”

The Company’s innovations are partly

driven via the “CPN Quality Award”

project, established to encourage the

management level of each department

and each branch to brainstorm, analyze,


and fi nd directions that would enable

their departments or branches to

achieve CPN’s goals and missions.

This year the project goal is to

upgrade the work at the management

level into a strategic focus and

analyze problems through fact-based

management. Creative projects that

generate innovations and pass the

screening process will be presented

and shared at the annual CPN

Productivity Contest, fi rst organized

in 2010, so that CPN people can

exchange the knowledge, choose the

best, and adapt them for their own

functions.

Thailand Quality Award Organizational Development Project

Since 2009, CPN has studied and

applied Thailand Quality Award (TQA)

approach as a framework for developing

its retail management systems. In

2011, three pilot shopping centers,

namely CentralPlaza Chiangmai Airport,

CentralPlaza Pinklao, and CentralPlaza

Rama 2, joined the TQA Contest. Even

though other shopping complexes

did not participate, they have been

developing their internal management

systems by adopting the TQA evaluation

criteria.

Thanks to the commitment, dedication,

and shared knowledge among the

teams of these pilot projects, CentralPlaza

Chiangmai Airport received the

prestigious Thailand Quality Class (TQC)

2011 as a proof of the international

standards of CPN’s retail management

systems. The knowledge, experience,

and work procedures obtained from

these pilot shopping complexes will

help every shopping complex under

CPN’s management internationalize

its standard of retail management.

International Standard Management

CPN has adopted International Standard

Management Systems for corporate

management as seen below:

> Retail Property Management under

ISO 9001:2008

ISO 9001:2008 is a quality management

standard adopted by CPN to ensure

customers’ and tenants’ utmost

satisfaction. It is a management

process with systematic linkage

and continuous service development.

In 2011, CPN applied for ISO 9001:2008

standard upgrading of 12 projects,

namely CentralPlaza Lardprao,

CentralPlaza Pinklao, CentralPlaza

shopping complexes

of CPN are now

ISO 9001:2008

certifi ed

A Prestigious

Thailand Quality

Class Award

121

Rama 2, Centra lPlaza Bangna,

CentralPlaza Rachada-Rama 3,

CentralPlaza Ramindra, CentralPlaza

Chiangmai Airport, CentralPlaza

R at t a n at h i b e t , C e n t r a l C e n t e r

Pattaya, CentralWorld, CentralPlaza

Chaengwattana, and CentralFestival

Pattaya Beach. Furthermore, three

new shopping complexes, namely

CentralPlaza Chonburi, CentralPlaza

Ud o n t h a n i , a n d C e n t r a l P l a z a

Khonkhaen, were certifi ed this year.

That means 12 shopping complexes

of CPN are now ISO 9001:2008-

certifi ed.

> Environmental Management under

ISO 14001:2004

ISO 14001:2004 is an environmental

management standard valued by

CPN, which is applied to ensure

that its business grows in tandem

with environmental development.

Operation focuses on pollution

p r e v e n t i o n a n d c o n t i n u o u s

development of an environmental

management system.

In 2011, CPN expanded its environ-

mental management system in

conformance to the standard of

ISO 14001:2004 under four certifi ed

projects, namely CentralPlaza Pinklao,

CentralPlaza Bangna, CentralPlaza

Chiangmai Airport, and Central Center

Pattaya to CentralPlaza Rattanathibet

and CentralPlaza Rama 2. Therefore,

six projects have now achieved such

certifi cation.

Strongly determined to manage its

environment under the policy to

turn CPN’s shopping complexes into

green buildings, CPN has fostered its

environmental management system

to pave the way for the remaining

shopping complexes to be ISO

14001:2004-certifi ed as the next step.


CPN is well aware that the Company is a small fraction of a large society. Yet,

when the personnel of this small society feel contented and have self-esteem,

these people are ready to create good things for customers, partners, and the

organization as well as playing a key role in developing the economy and society

to ensure sustainable growth.

Personnel Data CPN’s headcount as of December 31 for the past fi ve years:

Branch / Year 2007 2008 2009 2010 2011

Head Offi ce1 421 588 635 655 725

Ladprao 193 183 178 187 154

Ramindra 54 50 53 51 52

Pinklao 180 146 141 138 127

Pattaya Center 88 96 89 91 87

Rama 3 106 107 106 103 101

Chiang Mai 143 143 142 142 146

Bangna 205 183 179 179 168

Rama 2 159 142 141 142 139

CentralWorld 405 387 396 375 356

Rattanathibet 99 96 96 99 100

Chaengwattana - - 127 129 135

Pattaya Beach - - 149 155 155

Udonthani - - 121 124 129

Chonburi - - 100 99 97

Khonkaen - - 110 111 108

Chiang Rai - - - 43 88

Phitsanulok - - - - 78

Rama 9 - - - - 110

Total 2,053 2,121 2,763 2,823 3,055

Remarks: 1 Staff of Langsuan Colonade are included.

HUMAN CAPITAL MANAGEMENT

Personnel Selection and Recruitment

To support future business growth,

CPN focuses on personnel selection

and recruitment to find experienced,

knowledgeable, and capable staff who

are suitable. The Company also considers

their potential for career growth and

proper qualifi cations to be in line with

the core value of “To be confidently

creative and strive for excellence

together”

CPN’s policy is to select and recruit

from within the organization first to

ensure that staff members receive

opportunities for self-development

and career growth. Furthermore,

CPN focuses on endorsement of staff

relocation to their hometowns where

its shopping complexes are located.

In addition to happiness at work,

they can share CPN’s determination

to bring development and diversify

revenue to local communities. Under

the selection process, the Department

of Human Capital Management jointly

considers with the affi liations to ensure

transparency in compliance with good

corporate governance.

Employee by Gender

53%Female

1,621

49%Age 31-45 years1,508

8%Age 46-60 years

236

43%Age 18-30 years

1,311

15%More than 10 yrs

460

10%Trainees

291 16%3-5 years479

24%5-10 years740

35%Less than 3 years

1,085

47%Male

1,484

Employee by Age

Employee by Years of Service


present the subordinate’s performance

to his or her own supervisor so that

they can acknowledge the evaluation

criteria. CPN’s system monitors and

compares staff ’s performance to

ensure fair evaluation that truly refl ects

their work.

Furthermore, CPN has established

welfare committees at Head Office

and every branch, which acquire

members from applicat ions and

selection from each department. Each

committee, with a two-year term, holds

quarterly meetings. They act as a staff

spokespersons by communicating

with the management team about

proper welfare, including guidelines

Management of Remuneration and Benefi ts

CPN values remuneration management

and conducts a survey of wages and

salaries to compare with the remuneration

and benefi ts off ered by peer business

organizations.

According to CPN’s policy, staff

remuneration is based on performance.

The evaluation system has therefore

been improved for more effi ciency, with

key performance indicators (KPIs) and

evaluation of potential serving as tools.

Under this system, both the supervisor

and the subordinate must agree on the

outcome. Then, the supervisor must

and patterns of activities to foster cordial

relations within and among branches.

After each meeting, the committee

delivers topics of improvement or

development to the representatives

for further implementation. If the

topic could lead to a major corporate

development, the welfare committee

proposes it to the Executive Board for a

specifi ed agenda item.

For fi nancial security, CPN has established

a provident fund where the money comes

from staff’s cumulative contribution,

the Company’s contribution, and

interests earned from the fund. CPN

pays for the contribution in the fund

by level as seen below:

Staff Level Staff ’s Contribution CPN’s Contribution

Rank and fi le 3% of total salary 3% of total salary

Managerial 5% of total salary 5% of total salary

Executive 10% of total salary 10% of total salary

Staff Relations Management

CPN is well aware that staff ’s contentment

and cordial relations directly aff ect work

effi ciency and eff ectiveness. Throughout

2011, it has organized various activities

as summarized below to strengthen

relations among staff , leading to higher

spirit and quality of life:

>> Family Day for staff to recognize the

family value, focuses on exercising

for health and taking staff and their

families on fi eld trips

>> CPN Club for staff to participate in

their favori te act ivi t ies while

promoting their physical and mental

health

>> “Staff Party” and “Birthday Party” for

staff members to relax and get

together as a way to express

appreciation for their constant

dedication

>> Activities for the public good, such as

blood donation as a tribute to Her

Majesty the Queen, with over

7,000,000 cc of blood donated this

year

>> Scholarship Project for Staff ’s Children

f r o m t h e e l e m e n t a r y t o t h e

undergraduate level to alleviate

the expense burdens of staff with

outstanding performance

>> Annual Alms-giving Project on

Visakha Puja Day to offer staff an

opportunity to attend a religious

ceremony with the Company and

promote their mental health

>> As part of the flood relief project

2011, CPN provided affected staff

with shelters, rescue bags, and

financial aid for basic necessities,

residential repairs, and temporary

evacuation.

In addition to the activities that foster

cordial relations among staff, CPN

believes that “caring for one another”,

such as listening to one another and

listening to staff ’s complaints, is another

way to create staff’s happiness and

engagement. Each staff member can

fi le a complaint via assorted channels

when facing difficulties at work or in

everyday life by:

>> Sending e-mail to the Audit Commit-

tee at [email protected]

>> Putting a message in the idea-Box

located at every branch

>> Mailing to the President at

PO Box 99, Pratunam Post Office

10409

>> Sending a let ter to the Audit

Committee.


CPN’s vision is to be ‘The Most Admired and Dynamic Regional Retail

Property Developer with World-Class Rewarding Experience’. It

recognizes the importance of creating and developing employees’

capabilities in a systematic, continuous way, as it believes that competent

staff is vital to business prosperity and a competitive advantage in the

long run.

CPN set up approaches to develop its

personnel to enhance their competencies

so that they will be ready and able to

fulfi ll CPN’s visions. Meetings were held

between executives and the management

team to defi ne personnel’s qualifi cations

and competencies. The outcomes were

used as guidelines for developing CPN

personnel, both through company’s core

values for team operation and through

the CPN Leadership DNA, which will

support CPN leadership in leading teams

efficiently and effectively to achieve

goals.

For the development of personnel in

shopping complex operations—our

core business—CPN’s focuses on

developing personnel competencies for

the positions as defined in individual

development plans (IDPs) jointly prepared

by supervisors and staff. Staff will be

updated on IDPs quarterly, as supervisors

enter feedback to recommend areas

of improvement to meet the requirements

of their current positions as well as

opinions on the development of staff

through coaching, training, special

assignment, including basic training

courses under CPN Training Roadmap.

This way, staff can apply the knowledge

gained to their work while supervisors

c a n m a n a g e a n d d e ve l o p s t a f f

performance.

HUMAN CAPITAL DEVELOPMENT

CPN Leadership DNA

In 2011, CPN has developed fi ve leadership DNAs to achieve its goals in effi ciently

expanding the business at the regional level. These DNAs are set as leadership

competencies in developing CPN’s personnel of management level to become

CPN leaders, consisting of:

Valuing customers and their needs as the primary focus of

business; creating or maximizing a profi table business based on

in-depth customer understanding, and evaluating and developing

ideas into a practical plan.

Identifying and building capability in people, work processes,

systems, work environment, and other related factors, in order to

drive sustainable business growth and results.

Maintaining results and morale when experiencing major

changes in the work environment or when introduced to new ideas;

adjusts eff ectively to work within new work structures, processes,

or requirements. Adapting and becoming a champion of change

to positively infl uence people around them to embrace change.

Leveraging the capabilities, insights, and ideas of all individuals,

internal and external to the organization, that impact business

results; developing and maintaining a work ambience which enables

full participation and development of all backgrounds, cultures, styles

and views; and creating opportunities that lead to a competitive

advantage.

Forming partnerships internally and externally by continuously

identifying and acting on those things that will create success

for CPN and its stakeholders.

Talent Management and

Succession Plan for Executives

CPN has set up a project to develop

outs tanding and high-potent ia l

personnel, focusing on enhancing

leadership potential according to CPN

Leadership DNA and preparing them

for higher positions on their career

paths in line with the Company’s

expansion through various development

programs, such as the Young Leadership

Program for middle management and

the Leadership Development Program

for Executives for senior executives.

In addition, for the development of

senior executives, a leadership potential

assessment was conducted under the

CPN Leadership DNA, which will be

translated into IDPs and succession

plan for high-level executives and key

positions to ensure that the management

are well equipped and ready for the

Company’s expansion as planned, locally

and internationally.

In-depth Customer Understanding

Sustainable Partnership Building

Respect of Cultural Diversity

Scale Mindset

Adaptability


SUSTAINABILITY MANAGEMENT

Direction of Sustainability Management

CPN has conducted its business with

the mission of developing outstanding

shopping complexes as the communities’

pride. To serve the needs of the community

and society, the Company initiated social,

environmental, and community projects

by adhering to the principle of “Care

for the Society, Care for Each Other”.

It was based on the Company’s core

values, “To be confi dently creative and

strive for excellence together”, and

corporate governance policy, which

emphasizes “Honesty, Truthfulness,

Openness, Transparency, Equality,

Justice, Accountability, and Caring for

Society”.

From the onset of operations, CPN has

conducted business with a conscience

for the society, community, and

environment, both as an individual

organization and in coordination with

other companies under the Central

Group. CPN was committed to conserving

energy, protecting the environment in

local areas and communities, promoting

traditions of local communities, as well

as supporting youth education and

development.

During the previous year, CPN restruc-

tured its sustainability management by

appointing a Sustainability Management

Committee, headed by the President

& CEO, with other CPN executives as

members. This committee, replacing

the Environmental Conservation and

Safety Committee, worked under three

directions of sustainability management:

economy, environment, and society.

Several working and monitoring teams

in the organization and shopping

centers were assigned to ensure that

the policy and action plans were

adequately comprehensive and aligned

with the development approach to

sustainability, and that they were

eff ectively implemented. Furthermore,

this policy has been communicated

to all employees to create a shared

recognition that being responsible to

society, community, and environment

was somewhat easy, and they could

always care for one another.

Performance

Economy

CPN’s policy on business conduct

adhered to the principle of “the prosperity

of partners and surrounding commu-

nities is our success”. Therefore, CPN

was determined to bring modernity and

civilization to the region by combining

its operations with those communities’

culture and social values. CPN was

proud to take part in driving growth and

sustainability of the regional economy, as

well as the independence of surrounding

communities. The operations that

support economic growth were divided

into three major categories as follows:

1. Offering internal and external

promotion areas of CPN’s shopping

centers to government agents, private

sector, and non-profi t organizations

as a venue to promote educational,

religious, arts and cultural and

charitable activities.

2. Providing space for local entrepre-

neurs or local communities to run

their businesses with similar targets

to the shopping centers’ goals. The

space and sales promotion in special

zones was managed in a fair and

systematic fashion.

> Northern Village Project on the

1st and 2nd floor of CentralPlaza

Chiangmai Airport held unique and

meticulously made Lanna-style

handicrafts.

> Kad Luang Project on the G fl oor

of CentralPlaza Chiangmai Airport

and CentralPlaza Chiangrai were

the center of freshly cooked food,

ready-to-eat food, and local

souvenirs.

CPN supported the economy at regional level and macro level by off ering promotion areas inside and outside the shopping centers to government agents, private sector, and non-profi t organizations as a channel to publicize or disseminate useful information to the public.

3. Joining local agents to organize

signature events of the region. This

off ered small entrepreneurs who were

not ready to rent the retail space in the

shopping center an opportunity to

display and promote their products to

the public. This was also an additional

channel for conducting business as

follows:

> The annual “Enjoy Crab and Sea

View” Festival had been co-hosted

by CentralPlaza Rama 2, the

Tourism Authority of Thailand

(TAT) (Head Offi ce), and the Bang

Khun Thian District Office for

nine consecutive years at “Central

Park” of CentralPlaza Rama 2. It

aimed to support entrepreneurs

in the seafood industry while

developing economic capability

and agricultural tourist (agro-

tourism) destination.

> The annual “Nonthaburi Durian”

Festival had been co-hosted by

CentralPlaza Rattanathibet, Tourism

Authority of Thailand (TAT) (Head

Offi ce), and Nonthaburi Provincial

Administration Organization for

four consecutive years. It aimed to

provide knowledge about durians

grown in Nonthaburi province

and preserve it as the signature

of Nonthaburi. The festival was

also a distribution channel for rare

species of durian.


The Environment

Energy Conservation Management

Energy Management Guideline

CPN conducted its business under its

energy-efficient policy, focusing on

maximizing the use of energy and using

it conscientiously. As a result, CPN has

developed a three-dimensional policy

regarding conserving energy, including:

1. Technical: Using up-to-date and

environmentally friendly technology

and applying it to CPN’s projects.

2. Organizational structure and policy:

Issuing policies and assigning a

clearly designated committee to work

on saving energy at the executive,

managerial, and operational levels.

This included an audit panel, consis-

ting of representatives from various

levels of the organization, namely

project management, business de-

velopment, asset management and

marketing department. This group

jointly over-saw the Company’s

energy policy.

3. Behavioral (or Personnel): Commu-

nicating and raising awareness of

conserving energy so that staff,

tenants, customers, and the local

community around the malls could

play an active role.

To ensure an optimal outcome of

environmental management, CPN set

the goals and policies on effi cient energy

consumption. The Company assigned

three main teams to study the energy-

saving measures, manage the energy

consumption in each shopping center,

and evaluate the energy management

system in each shopping center. In the

previous year, these teams had quarterly

meetings to monitor progress. The

system department managers from

every shopping center attended small

meetings to exchange their knowledge.

Innovations in Energy Conservation

CPN had fully implemented its know-

ledge and experience regarding energy

conservation since 2005, starting

with collecting of the Specifi c Energy

Consumption (SEC) Index, which was

energy consumption per usable area.

The data were analyzed and referred

to when formulating an annual energy

management policy, leading to inno-

vations in sustainable energy manage-

ment.

CPN continuously implemented modern

and green technologies to ensure the

efficiency of electrical systems in the

shopping centers and to reduce pollution.

Innovations in energy management

adopted by CPN were as follows:

> Innovation under the Leadership

in Energy & Environmental Design

(LEED) was adapted in designing

new projects and renovating existing

projects. It focused on a building design

that utilized more natural light to save

energy, used more environmentally

friendly materials, and incorporated

more green space.

> Variable Speed Drive System was

in place. By controlling the Variable

Speed Drive (VSD) of the cool-air

handling units in large air conditioning

systems, the right temperature for

each working period would be adjusted

automatically, taking into account

the comfort of building occupants. For

example, the air conditioner would

accelerate the cool air when it was

hot and would decelerate the cool air

when it was cool.

> Ball-Cleaning System, the equipment

for cleaning the copper surface of the

pipes inside the cooling system of

the water coolers, was put in place. it

worked automatically and non-stop

to maintain the effi ciency of the water

coolers.

> PU Foam, an innovative heat insulator

for buildings, was used. With foam

sprayed on the roof, it prevented

the outside heat from invading the

building.

> Sky Light was installed. it allowed

only natural light, but not heat, to come

through a row of heat-protecting

glasses The building would, then, get

enough light while the temperature

remains unchanged. This was an easy

way to reduce energy consumption

and yield a high return on investment.

> Energy-efficient light bulbs were

used. For example, incandescent

light bulbs were replaced with compact

fl uorescent (CFL) and T8 fl uorescent

lamps were replaced with smaller

T5 fluorescent lamps. Furthermore,

the light emitting diode (LED) lights

were installed inside and outside the

buildings to save signifi cant energy for

the shopping centers which required

the lights to turn on at all time.

> High effi ciency chiller, an innovation

in large air-conditioning systems

which consumes 20 – 30% less energy

(compared to normal cooling system),

was used. It could generate more cool

air with using better environmentally

friendly cooling agent.

> Auto-sensor escalators with highly

accurate sensor were installed. This

allowed the escalators to move

automatically when people used them.

This would save energy in the area

where escalators were hardly used.

> Intelligent elevators were operated

with radio-frequency identification

(RFID) cards for more efficiency.

The computerized system calculated

the traffic to minimized energy

consumption. Currently, this technique

is implemented in The Offices at

CentralWorld and The Offices at

CentralPlaza Chaengwattana.

> Solar cells were installed. These solar

cells generated direct current and sent

to the transformer, via a control system,

to convert into alternating current for

the electrical system in the shopping

centers. Currently, this technique is

implemented at CentralWorld.

Fostering Conscience

of Energy Conservation

CPN was well aware that the key factor

in energy conservation was to educate

stakeholders and raise their conscious-

ness, which leaded to optimal and

sustainable use of limited natural

resources.

> CPN Staff

The staff in the organization was the

first group of stakeholders among

whom CPN would like to promote

the value of energy conservation.

Every level of staff in the organization

should gain enough knowledge and

understanding to be a role model in

conserving energy. The main activity

CPN annually organized was “Energy

Day”, which encouraged all staff

to attend recreation together and

learn how to save energy at the same

time. Other activities were “Slogan

Contest on Energy Conservation”

and “Energy Ambassador Contest”.

Throughout the year, the Energy

Conservation Committee also pro-

duced several media products to

promote consciousness to make the

best use of energy at work and in

day-to-day life.

> The Public

CPN furthered its energy-conserving

ideas by opening the Green World

Experience Learning Center at

CentralWorld in addition to its annual

energy conservation activities, co-

hosted by CPN and the government

sector, such as Earth Hour, World

Environment Day, and Energy

Conservation Week. The main purpose

was to encourage the private sector

and the public, especially the youth,

to recognize the importance of saving

energy and the environment. The

knowledge about energy-saving

innovations successfully adopted

by CPN was spread in the society to

educate people and to serve as a role

model.

CPN also ran the “Car Pool Parking”

campaign to encourage shoppers to save

energy. Cars with at least four passengers


could use a special parking area in

the best zone on level B1 of CentralWorld,

which could accommodate 50 cars.

The purpose of the campaign was to

encourage people to reduce gasoline

consumption. Besides the special parking

zone, CPN provided special areas in

several shopping complexes for bicycles

to encourage the use of clean alternative

energy.

Major Energy Conservation Projects

> “Building Energy Award of Thailand”

Project or “BEAT 2010”

The BEAT 2010 campaign is an

abbreviation for Building Energy

Award of Thailand 2010, initiated by

the Energy Policy and Planning Offi ce

(EPPO), Ministry of Energy. The aim

was to raise public awareness of

energy conservation. CentralWorld was

selected as one of leading commercial

buildings to join the project under

the category of shopping centers and

department stores. The project took

place from August 2010 to August 2011.

Although some parts of CentralWorld

were under construction during that

time, CPN has been promoting energy

conservation throughout the year

when the Company joined the project.

Some fi nancial support came from the

BEAT 2010 project. The main activities

were as follows:

> Energy Day & Kick-Off BEAT Project

was held to promote the objectives

of the project and the participation

of staff of CentralWorld. The event

included a contest for energy-

conserving ideas and an exhibition

providing knowledge of energy

conservation.

> The training of the BEAT Ambassadors

and fi eld trips to visit energy-effi cient

buildings.

> The “Energy-Saving Calendar for

Kids” activity

> During the “Use Less Plastics” activity

on World Environment Day, the staff

brought used plastic bottles to set a

record. These bottles were later

reused or recycled. It is an activity

in support of “Love Earth, Take Care

Earth”, which is annually hosted at

CentralWorld Square.

> As one of the annual activities, “Pha Pa

for Light” was held during Buddhist

Lent. The BEAT Ambassador,

together with CPN, volunteered

to replace old bulbs with energy-

saving bulbs. These volunteers

also inspected and repaired all

electrical equipment for Klong Mon

Temple and Klong Mon School in

Samut Prakan province. The staff

members were encouraged to

donate energy saving bulbs to

temples and schools.

> The “Green Film Festival” showed

f i lms that promoted energy

conservation for one week at TK Park

on the 8th fl oor of CentralWorld.

The event was provided free of

charge for the public.

> “Energy Alliances Following HM the

King’s Resolve on the Occasion of His

84th Anniversary”

CPN, together with Krungthai Bank

Plc., Thai Airways International Plc.,

and Ek-Chai Distribution Co., Ltd,

signed a Voluntary Agreement to

jointly create an energy saving network

as a project to support the captioned

event and to promote and campaign

for energy conservation among the

public.

Corporate Social Responsibility

Environment and

Community Management

CPN realized the value of our limited

natural resources and cares for

stakeholders’ quality of life and the

environment around the shopping

centers. Therefore, the Company

formulated explicit policies regarding

environmental conservation, starting

with the building design, building

construction, and project management.

Every project under CPN’s management

must pass the basic environmental

guideline listed below:

> Developing and writing an environ-

mental impact assessment (EIA) report

to be submitted with the construction

permit.

> Issuing policies on construction

safety, which covered safety standards,

directions in controlling and moni-

toring environmental impacts, a

quality control manual, and a guideline

for CPN contractors to ensure that

construction proceeds in compliance

with CPN’s safety standards.

> Installing a wastewater treatment

pond in compliance with Thai laws

and using of biological methods

for treatment. The wastewater was

monitored, recorded, and reported

before being released into public water

sources.

> Installing a CO Detector to monitor the

level of carbon monoxide (CO) in the

parking building to make sure that it

does not exceed the standard.

By strictly adhering to the highest safety

standards and continuously developing

its environmental management system,

CPN has become Thailand’s pioneer in

retail property developers to implement

ISO 14001:2004 in its shopping centers

to reduce negative environmental

impacts. In 2011, CPN expanded its

environmental management system

under the ISO 14001:2004 standard from

four shopping centers (CentralPlaza

Pinklao, CentralPlaza Bangna, CentralPlaza

Chiangmai Airport, and CentralCenter

Pattaya) to include two more (CentralPlaza

Rattanathibet and CentralPlaza Rama 2).

The goal was to have all CPN’s shopping

complexes certifi ed by ISO 14001:2004.

Waste Management

CPN formulated clear policies on waste

management by taking safety and

resource conservation into account.

The waste materials generated from

CPN’s projects were separated into

(1) general waste (2) recyclable waste

(3) hazardous waste and (4) infectious

waste. Furthermore, each zone provided

diff erent trash bins to suit each type of

waste. In the general zone, two types of

trash bins (bins for general waste, and

bins for recycled waste) were available.

In the IT zone, food center, and the offi ce

zone, three types of trash bins (for general

waste, recyclable waste, and hazardous

waste) were provided. For shops with

infectious waste, CPN provided specifi c

recommendations and informed them

of the regulations to manage such waste

so that they could do it themselves. All

waste materials were categorized and

separated into saleable waste, waste to be

destroyed, and recyclable waste.

Water Resource Management

CPN systematically controlled and

managed its drainage through its water

treatment pond at every project site.

The Company tested the quality of the

water before and after it entered the water

treatment system and wastewater pond.

Before releasing the wastewater into

public water sources, CPN monitored

the wastewater and completed a

thorough record and report. The water

was also tested by an outsider at least

once every quarter. CPN’s adoption of

ISO 14001:2004 in retail management

aimed to reduce negative environmental

impacts and create innovations in

wastewater management and eff ective

reusing processes. This new program

has been applied at the new shopping

center, CentralPlaza Changwattana,

which had a system to reuse the treated

wastewater, rain, and condensed liquid

from the air-handling unit for watering

plants, cleaning floors, or filling the

cooling tower. The quality of treated

water was regularly tested before being

used, and the outcome showed that it

was above standard.

Monitoring Contractor Operations

CPN set a policy for all contractors who

worked for CPN, including the organizers

in charged of sales promotion activities

in the shopping centers, to adhere to

all environmental rules. After the work


is completed and handed over, the

contractors need to fi ll out the form about

pollution control and environment in

the workplace, as well as the form for

checking the tidiness in the area where

activities take place. They must also

provide reports regarding the noise level

of each activity.

CSR Projects for the Community

Environment

> CentralPlaza Pinklao, together with the

Bangkok Metropolitan Administration

and Bangkok Noi District Office,

engaged in the “Cleaner Water for

Khlong Bang Bamru 2011” project to

dredge and clean the canal and

restore its natural conditions for the

community.

> CentralPlaza Suratthani moved 398

trees of 20 species originally on the

compound and replanted them around

the project area after construction was

completed.

Society

Occupational Health and Safety

Management

Safety

CPN formulated policies on monitoring

the environment in and around shopping

complexes, offi ce buildings, hotels, and

residential projects to be safe for tenants’

and customers’ lives and assets:

> CCTVs (which were regularly main-

tained) were installed in car parks and

shopping complexes.

> A maintenance schedule was provided

for equipment, such as elevators,

escalators, gas burners, and cooking

appliances.

> An emergency response action

and control plan was developed in

compliance with ISO 9001:2008.

Health

> A policy for managing and controlling

ventilation inside the building was

proposed in conformance to the law

and ISO 14001:2004 standard for

environmental management. This

international standard is used as a

guideline for managing its shopping

complexes.

> Automatic ventilation systems were

installed to bring in fresh air from

outside buildings. CO-detectors were

also installed at parking lots to monitor

carbon monoxide and prevent it from

going over the standards.

> Regular assessments of restaurant

operations in CPN shopping complexes

are conducted, and a “Clean Kitchen”

project is carried out to encourage

restaurant operators in the shopping

complex to be mindful of good hygiene.

> A sanitation system was in place, which

provided an effective and hygienic

system for storing and removing

garbage and waste.

> Sanitation gel administration points

were installed at the entrances and

exits of all shopping malls.

> With an outbreak of respiratory diseases

during the year, the shopping complexes

were cleaned more regularly. CPN

also installed a disinfecting system

commonly used at hospitals to clean

shopping complex areas and set up

information boards on how to prevent

respiratory diseases.

Community Participation and Social Development

Education

The “CPN Cultivates Thai Wisdom”

Project

CPN strongly believes that young people

are a critical foundation for society.

Educating and instilling moral and

ethical conduct in youths will enable

communities and society to become

sustainable and self-suffi cient. Supporting

the education of Thai youths, especially

less-privileged ones, is therefore one of

the primary policies and strategies for

CPN’s sustainability management and

was the main inspiration behind the

“CPN Cultivates Thai Wisdom” Project.

Through this project, CPN has cooperated

with government agencies, our partners,

and other companies under the Central

Group to provide support for education

for less-privileged communities and

youths by building a learning center for

the community and building libraries

for poor schools. CPN has also donated

many teaching and learning tools for

such youths.

As one of main activities in this project,

CPN and the Institute for the Promotion

of Teaching Science and Technology,

with the support of the business partners

and companies under the Central Group,

developed community learning centers

to provide more opportunities for

self-learning through the provision of

various media, including videos, DVDs,

computers, the internet, book corners,

and scientifi c experiments. To date, CPN

has developed nine such centers in:

> Ban Khlong Muang School, Amphoe

Muang, Krabi

> Bamrung Islam School, Amphoe Muang,

Pattani

> Nakhon Khon Kaen School, Amphoe

Muang, Khon Kaen

> Tasdikiya School, Amphoe Chana,

Songkhla

> Prapatsorn Witthaya School, Amphoe

Muang, Chonburi

> Ban Pong Malaengwan (Chirathiwat

Upatham) School, Amphoe Muang,

Nakhon Ratchasima

> Alawiya Wittaya School, Amphoe

Bannang Sata, Yala

> Ruam Sun Wat Huai Kaeo School,

Amphoe Mae On, Chiang Mai

> Mae Pa Wittayakhom School, Amphoe

Mae Sot, Tak.

In addition to educational support for

the youth and communities in the

previous year, the “CPN Cultivates Thai

Wisdom” Project expanded its scope

to convicts by donating computers

and books to the Special Penitentiary,

Department of Corrections, Pathum-

Thani province, to promote the reading

habit among prisoners and enhance

their opportunities to further their

education, earn livelihood, and be

self-dependent without using drugs or

committing crimes.

Other Educational Activities

In addition to CPN’s main educational

activities under the “CPN Cultivates

Thai Wisdom” Project, each branch or

shopping complex under CPN organized

additional activities for local commu-

nities as described below:

Donation of Computers

and Learning Tools

> CentralPlaza Chiangmai Airport

donated 20 computers to Educational

Service Area Offi ce 5 of Chiang Mai

for students in Ban Tian Ang School,

Amphoe Hot, Chiang Mai.


donated learning tools to municipality

schools in Tambon Mae Chaem,

Chiang Mai.

Lunch Fund Project

> CentralPlaza Bangna hosted the 5th

“Spread Generosity among Less-

Privileged Kids” project for the public

good and happy families. More than

80 CPN Volunteer staff at the Bangna

branch and their families constructed

a playground together, hosted a lunch,

and donated learning tools to students

of Sitthi Sunthon Uthit School, Amphoe

Bang Nam Priao, Chachoensao.

> CentralPlaza Bangna hosted “Toys

Crazy...Charity for Child”, distributing

toys donated by shops and customers

to disadvantaged children at the

Foundation for the Better Life of

Children and Ban Nok Khamin

Foundation.


donated the proceeds from the

“CentralPlaza Chiangmai Airport


Mini-Marathon” to the lunch funded

for students in Wat Don Chan School,

Chiang Mai.

Drug-Free School Project

> CentralPlaza Pinklao, in collaboration

with the Bangkok Metropolitan

Administration, hosted “Drug-Free

Schools under BMA in Bangkok Noi

district” at Wat Mali School, with CPN

Volunteer staff attending the activity

and donating sports gear to students

and surrounding communities to

encourage them to constructively

spend time and stay away from drugs.

Volunteer Spirit

“CPN Volunteer” Project

The “CPN Volunteers” project started

from a small group of CPN employees

who truly reflected the Company’s

wishes to see staff participate in

activities for the public good to foster

their conscience to understand the

significance of repaying society and

community. In 2008, CPN established

“CPN Volunteers” with continually

growing membership of those with

volunteer spirit to 1,000 at present from

250 at the outset.

The CPN Volunteers group annually

takes turn conducting activities for

communities near shopping complexes

under CPN’s management, as well as

for volunteers’ home communities

proposed to the CPN Volunteers Group

Committee. These activities revolve

around the idea of social responsibility

and sustainable community development.

In the past year, the group’s activities are

summarized below:

> “Open up the Wide World

for Kids” Project

CPN Volunteers took more than 400

boy scouts and girl scouts from Amphoe

Cho-airong, Narathiwat province,

on a field trip to “TK Park” and the

B2S bookstore at CentralWorld. Then,

they had a meal, supported by Central

Restaurant Group (CRG), and received

sports gear from SuperSports under

the management of CRS Sports Co., Ltd.

> CPN Volunteers joined the “Presenta-

tion of Space in the Administration

Building of Police General Hospital”

project to facilitate patients in the

“Doing Good Deeds for One Day”

activity. CPN, joining companies

under the Central Group, donated

Baht 10 million to renovate the

Administration Building of the hospital.

The project started in 2010 and was

completed in 2011.

> “Pha Pa for Energy

and Education” Project

The “Pha Pa for Energy” Project is

annually organized during Buddhist

Lent and was adapted to “Pha Pa for

Energy and Education” in 2011. The

donation went to not only water bills,

electricity bills, and maintenance of

Wat Khlong Mon, but also renovation

of the meeting hall and students’

sports gear at Khlong Mon School,

Samut Prakan.

> “Care for Flood Victims

in Phitsanulok” Project

CentralPlaza Phitsanulok and more

than 50 CPN Volunteers donated

survival kits, rice, and dried food to

flood victims in Amphoe Phrom

Phiram and Bang Rakam, Phitsanulok,

during the Great Floods in August 2011.

> “Help Flood Victims Together” Project

During the fl ooding crisis of 2011, CPN

Volunteer members got together to

help victims in the following activities:

> On 6 October 2011, they donated

cash to help communities in

Rattanathibet and Chaengwattana

(in suburban Bangkok).

> On 12 October 2011, they joined

hands in sort ing donations

and packing survival kits at the

evacuation center at Thammasat

University, Rangsit Campus.

> Between 1 November and 15

December 2011, CPN Volunteers,

together with companies under

the Central Group, joined the

“Central ’s Sympathy” project

during the flooding situation at

CentralWorld Square, CentralWorld.

They cooked food, packed it in

boxes, and handed out such boxes

of food to victims at different

locations each day.

> CPN Volunteers, together with

companies under the Central

Group, hosted a blissful activity

under the “Central’s Sympathy:

We Owe Our Existence to You”

project. Actors and members of

“CPN We love Music” performed a

mini-concert at the fl ood victim

shelter at Government Complex,

Chaengwattana, to ease victims’

stress.

> “CPN New Year Greeting Cards for

Kids in Phitsanulok” Project

> On New Year’s Day and National

Children’s Day 2011,

CentralPlaza Phitsanulok and over 30

CPN Volunteers hosted an activity for

more than 700 students from seven

schools, such as Wat Kammathan

School, Wat Si Wararam School,

Theerathada School, Wat Samo Khae

School, Wat Noen Makhuek School,

and Child Development Centers

under Samorkae TAO and Wat Nern

Makuek. To bring joy and smiles to

the children and share good things to

make society a better place to live in,

they gave out gifts, instructional media,

learning tools, sports gear, and warm

clothes and organized recreational and

educational activities.

Religion

> “Bliss and Balance

with Dhamma and Nature’s Ways”

Dhamma Delivery Activity

CentralPlaza Rattanathibet, together

with the Soi Thong Royal Temple,

hosted a Dhamma delivery activity by

inviting Phra Maha Sompong Talaputto

to deliver a sermon under the title

of “Bliss and Balance with Dhamma

and Nature’s Ways” to the interested

public at Park Zone of CentralPlaza

Rattanathibet.

> “Clean Toilets for Temples” Project

This project maintains and improves

toilets and buildings at all places

of worship, regardless of religions

practiced. In the past year, CentralFestival

Pattaya Beach, together with staff

with volunteer spirit, restored the

toilets at Durul Ibada Mosque and

Saint Nikolaus Church in Pattaya

Metropolitan Municipality to hygienic

conditions.

> Presentation of Candles during

Buddhist Lent

CentralPlaza Chiangmai Airport,

together with CentralPlaza Udonthani,

presented candles to Wat That Kham,

Wat Sri Suphan, and Wat Muen San in

Chiang Mai and Wat Sunthon Pradit

in Udon Thani on Asanha Puja Day

and Buddhist Lent.

“…In working for society or providing help

to society, one must do it with honest

intentions and with spirit, and not just for

public relations. Most importantly, we must

provide an opportunity for the organization’s

employees to have a real chance to help

society and the local community, whether

physically or intellectually, using their work

processes as the driving force for society’s

development. Together, we can create a

self-suffi cient and sustainable society.”

Kobchai Chirathivat

President



RISK TYPE

01 Strategic

Risks

Risk from overseas investment

Failed overseas investment could

aff ect the Company’s ROI

02 Operation

Risks

Risks from organizational competency

Failure to ensure organizational and

personnel readiness for business

expansion may cause the Company to

lose business expansion opportunity

and hinder its profi tability.

Risks from construction work

Failure to manage planned

construction time and cost may

hurt the Company’s cash fl ow and

profi tability.

RISK MANAGEMENT

Focus on implementing strategies in conformance to CPN’s mission and business

plan to ensure that strategies and objectives are compatible with acceptable risks.

> Undertake a thorough study on the operation of business in each country before

deciding to invest.

> Continuously monitor economic, social, and related business situations to

ensure appropriate responses.

> Jointly invest with high-potential business allies.

> Undertake organizational and personnel preparation to ensure readiness for

overseas investment.

> Enhance diff erentiation and competitiveness through continuous development

of shopping centers, standard of services, and management.

> Acquire funding sources to ensure capital adequacy and maintain appropriate

net interest-baring debt to equity ratio.

Focus on every step of operating processes from investment, IT, to personnel,

including safety risks, which could harm lives and cause damage to CPN

properties.

> Improve effi ciency of all work processes to support the Company’s growth.

> Develop key personnel’s capability for promotion under the Succession Plan and

Individual Development Plan (IDP).

> Develop training roadmaps in line with employees’ competency profi le.

> Develop change management processes and communicate them throughout

the company to ensure readiness for organizational changes.

> CPN’s application of Value Engineering Technique and systematic supervision

process ensures the successful completion of construction projects without

reducing the projects’ quality or credibility.

> Construction contractors are selected through a transparent and efficient

process.

RISK FACTORS

RISK TYPE

Risks from sabotage, accidents,

and natural disasters

Damage caused by these calamities

may halt the Company’s business,

hurt its cash fl ow and hinder

profi tability.

03 Compliance

Risks

Risks from legal provisions and

government policies

Failure to thoroughly examine related

laws, including possible changes in

regulations and government policies

before deciding on investment may

lower the Company’s return on

investment and profi t growth.

04 Financial

Risks

Interest rate risks

Fluctuated interest rates may increase

the Company’s costs and reduce

profi ts/returns as well as aff ecting

future business expansion.

RISK MANAGEMENT

> Take out comprehensive insurance policies for all projects under CPN’s

management to prevent financial losses from damage caused by natural

disasters, accidents, and sabotage.

> Formulate Emergency (Crisis) Management Plans and Business Continuity

Plan (BCP) to minimize impacts caused by emergencies or crises.

Focus on strict conformance to internal and external regulations, including related

laws.

> Rank project locations and land sizes, as well as conducting detailed studies of

legal limitations before deciding to invest.

> Closely monitor changes in all applicable aspects, including city planning,

expropriation areas, development of mass transit systems, and environmental

conservation laws to ensure appropriate property development planning.

Focus on managing the Company under prudent monetary policy by controlling

expenses under the approved budget, thus ensuring appropriate returns, as well as

the public’s confi dence in the Company’s acceptable, effi cient risk management

and internal controls under the fast-changing business environment.

> Increase the ratio of fi xed interest rate loans.

> Use alternative fi nancial instruments, including interest rate swaps, to increase

the ratio of fi xed interest rate loan.

> Use other fund mobilization alternatives aside from loans, including mobilization

through property funds and identifying joint investors for new projects.


CAPITAL STRUCTURE

CPN’s capital structure, as at 31 December 2011, was as follows:

1. Capital Structure

Common shares

Authorized share capital 2,178,816,000 Baht

Paid-up share capital 2,178,816,000 Baht

Number of common shares 2,178,816,000 shares

Par value 1.00 Baht

Share price 37.75 Baht

Unsecured and unsubordinated debentures

Debenture Credit Amount Issuance Life Interest Repayment of Maturity Balance as at

rating (MB) Date (year) Payment Cycle Principle Date 31 Dec 2011

CPN126A A+ 3,000 14/06/2007 5 Every 6 months Upon maturity 14/06/2012 3,000




CPN127A n/a 1,000 24/07/2009 3 Every 6 months Upon maturity 24/07/2012 1,000

CPN126B n/a 500 09/06/2010 2 Every 3 months Upon maturity 11/06/2012 500

CPN15DA n/a 500 28/12/2010 5 Every 6 months Upon maturity 28/12/2015 500

CPN163A n/a 500 25/03/2011 5 Every 6 months Upon maturity 25/03/2016 500


CPN16OA A+ 1,200 12/10/2011 5 Every 3 months Upon maturity 12/10/2016 1,200

CPN18OA A+ 500 12/10/2011 7 Every 3 months Upon maturity 12/10/2018 500

CPN21OA A+ 300 12/10/2011 10 Every 3 months Upon maturity 12/10/2021 300

CPN156A n/a 1,000 23/12/2011 3.5 Every 6 months Upon maturity 23/06/2015 1,000

CPN171A n/a 1,000 23/12/2011 5.1 Every 6 months Upon maturity 23/01/2017 1,000

Remarks : Average applicable annual loan interest rate of 4.31% per annum

Company Financial Ratios following the Debenture’s Rights Covenant Ratios As at 31 Dec 2011

and Conditions

1. Total Debt to Total Shareholders’ Equity Not over 2.50 times 2.14 times

2. Total Interest Bearing Debt to Total Shareholders’ Equity Not over 1.75 times 1.23 times

3. Total Assets (excluding Secured Debt) to Unsecured Debt Not less than 1.50 times 2.91 times

2. Shareholders

CPN’s shareholding distributions as at 31 December 2011 are:

Shareholders Shares Shareholding (%)

Registered Capital 2,178,816,000 100.00%

Local Shareholders

> Juristic persons 887,443,239 40.73%

> Persons 704,007,658 32.31%

Total 1,591,450,897 73.04%

Foreign Shareholders

> Juristic persons 497,704,933 22.84%

> Persons 89,660,170 4.12%

Total 587,365,103 26.96%


Top ten major shareholders as at 31 December 2011 are:

Shareholders Shares Shareholding (%)

1 Central Holding Co., Ltd. 588,171,980 27.00%

2 HSBC (Singapore) Nominees Pte Ltd* 184,813,019 8.48%

3 Thai NVDR Co., Ltd. 94,629,236 4.34%

4 The Bank of New York (Nominees) Limited* 67,257,798 3.09%

5 Mrs. Arunee Chan 45,079,760 2.07%

6 Mr. Suthichai Chirathivat 41,794,000 1.92%

7 Mr. Suthikiati Chirathivat 41,730,200 1.91%

8 Mrs. Suchittra Mongkolkiti 33,652,400 1.54%

9 EFG BANK AG 33,173,650 1.52%

10 Mr. Prin Chirathivat 30,150,550 1.38%

Remarks: * The Share Registrar is not able to give details of the names of Shareholders; however these nominee accounts do not have any infl uence over the Company’s strategies or operational management.

> Major shareholders have signifi cant

de facto influence on policies or

operations of CPN

Since Central Holding Co., Ltd., and

members of the Chirathivat family

altogether hold approximately 60%

of the total shares in CPN, they have

signifi cant de facto infl uence on its

policy formulation and operations.

This is because 7 out of the 12 members

of the Board are representatives of

these major shareholders.

> Foreign Limit in Shareholding

CPN has set a foreign limit of 30% of

the paid-up capital. As at 31 December

2011, foreign investors altogether

held 26.96% of CPN’s total paid-up

capital.

3. Dividend Policy

The policy of CPN is to pay dividends

not less than approximately 40% of its

operating net profi t from consolidated

fi nancial statement, except when there is

a compelling reason not to. The dividend

payment will not exceed the retained

earnings in separate fi nancial statement.

The policy of CPN’s subsidiaries is to

pay dividends when it has net profit

and adequate cash flow balance. The

dividend payment will depend on the

consideration of the Board of Directors

and shareholders of the subsidiaries

and it will not exceed the retained

earnings in fi nancial statement.

CPN Names of directors and executives holding CPN shares

Directors and executives holding CPN shares as at 31 December 2011, are as follows:

No. Name Position Shares Shareholding (%)

1 Mr. Suthichai Chirathivat Chairman 41,994,000 1.93%

2 Mr. Suthikiati Chirathivat Director 41,730,200 1.92%

3 Mr. Prin Chirathivat Director 30,150,550 1.38%

4 Mr. Kobchai Chirathivat Director, 26,493,500 1.22%

President & Chief

Executive Offi cer

5 Mr. Sudthidej Chirathivat Senior Executive 16,295,700 0.75%

Vice President

6 Mr. Sudhisak Chirathivat Director 14,173,200 0.65%

7 Mr. Sudhitham Chirathivat Director 13,382,300 0.62%

8 Mr. Suthipak Chirathivat Executive 12,794,800 0.59%

Vice President

9 Mr. Suthichart Chirathivat Director 9,318,100 0.43%

10 Ms. Wallaya Chirathivat Senior Executive 8,659,600 0.40%

Vice President

11 Mrs. Narttaya Chirathivat Executive 8,619,600 0.40%

Vice President

Remarks: The amount of shares as shown are included the shares holding by spouse and minor child of directors and executives.


International OperationsDevelopment

Risk Management CommitteeAudit Committee

Internal Audit

ORGANIZATION CHART

Construction Management

Business Development Project Development

Construction Management

Construction Management 2

Government Relations & Land Acquisition

Conceptual Design & Site Study

Business Development

Construction Management 1

Project Development

Business Development & Construction Management

Leasing

New Business

Business Analysis Cost Control

Property Management & Marketing

Planning, Policy & SupportThailand Operations

President & CEO

Board of Directors

Corporate Governance Committee

Nomination & RemunerationCommitteeBoard of Executive Directors

External Aff airs

Company Secretary

Human Capital & Organization Development

Corporate Strategic Offi ce

Property Management

FinanceMarketingLeasing

Organization Development

Property Development

Branch Marketing

Strategic Tenant Leasing

Tenant Management Information System

Corporate Marketing

Design Review & Visual Merchandise

Property Management

Key Account Marketing

Chain Tenant Leasing

Merger & Acquisition

Risk Management

Finance & Risk Management

Information Management &

Quality Management

Accounting

Human Capital Strategy

Legal


MANAGEMENT STRUCTURE

CPN’s Management Structure comprises:

1. Board of Directors

2. Sub-Committees

2.1 Audit Committee

2.2 Nomination and Remuneration

Committee

2.3 Risk Management Committee

2.4 Corporate Governance

Committee

3. Executive Committee

4. Management Committee

Details of each Board Committee are as

follows:

Board of Directors

The Board of Directors consists 12

directors, and comprises of :

>> 4 independent directors equivalent

to one-third of the Board of Directors,

in compliance with good corporate

governance principles.

>> The Chairman of the Board represents

the shareholders, and is a diff erent

person from the President & CEO, in

order to have complete separation of

responsibilities as well as a balance of

power in operations.

>> 11 non-executive directors and one

executive director.

The names and positions of the members

of the Board of Directors are as follows :

1. Mr. Suthichai Chirathivat 2,

Chairman

2. Mr. Paitoon Taveebhol,

Independent Director

3. Mr. Chackchai Panichapat,


4. Mrs. Sunandha Tulayadhan,


5. Mr. Karun Kittisataporn,


6. Mr. Kanchit Bunajinda,

Director

7. Mr. Suthikiati Chirathivat 2,

Director

8. Mr. Suthichart Chirathivat 2,

Director

9. Mr. Sudhisak Chirathivat 2,

Director

10. Mr. Sudhitham Chirathivat 2,

Director

11. Mr. Prin Chirathivat 2,

Director

12. Mr. Kobchai Chirathivat 1, 2,

Director

Note :1 An Executive Director 2 Representatives of the shareholders

Director with company signatory rights

Director with company signatory

rights are Mr. Sudhitham Chirathivat,

Mr. Prin Chirathivat, and Mr. Kobchai

Chirathivat with two of the three

signatures with Company seal for

validity.

Duties and responsibilities of the Board

1. Perform all duties in compliance

with the law, Company objectives

and articles of association, and

shareholders’ meeting resolutions

with duty of loyalty and duty of

care, with accountability and ethics,

keeping in mind the equitable

interests of the shareholders.

2. Define CPN’s vision, strategies,

plans, and its annual budget and

continuously monitor its perfor-

mance to ensure that the goals are

achieved and potential difficulties

are promptly dealt with.

3. Approve significant transactions

under its authority required by law

and the articles of association, and

approve capital expenditure budget

exceeding 200 MB.

4. Appoint sub-committees to support

the operation under its responsibility

as seen appropriate and necessary,

and regularly monitor their perfor-

mance.

5. Independent directors should

exercise independent discretion

in the formulation of strategies,

management of work and resources,

appointment of directors, and

determination of business standards.

They should also be prepared to

disagree with the management and

other directors on matters that may

aff ect the equality of shareholders.

6. Ensure that all relevant information

is accurate ly disc losed to a l l

shareholders and stakeholders

alike, with full transparency and

reliability as well as on an equal and

timely basis.

7. Institute an efficient and effective

internal control system and internal

audit.

8. Institute an effi cient and appropriate

risk management process that can be

evaluated, monitored, and managed

for key risks.

9. Appoint a company secretary to

oversee various Company activities

and assist the Board and the

Company in conforming to the law

and applicable regulations.

10. Institute a CPN code of conduct and

ensure that the directors, executives,

and all employees follow this code.

11. Institute good corporate governance

practices and ensure effective

communication with all employees

for acknowledgment and strict

compliance.

12. Institute a transparent and clear

process for connected transactions.

13. Institute clear processes for the Audit

Committee’s report to the board.

In case of doubtful transactions or

activities that could significantly

aff ect the Company’s fi nancial status

or performance, the Board must

resolve the issue within the time

limit seen fi t by the Audit Committee.

14. Formulate succession plans for top

executives.

15. Regularly review and update key

policies and plans as seen suitable

for the business environment.

16. Revise and update Board of Directors

Charter to ensure its timeliness.

17. Seek professional business guidance

by hiring outside advisers with CPN’s

budget.

18. Perform other shareholder-assigned

duties.

CPN has def ined much s t r ic ter

qualifi cations for independent directors

than those required by the Securities

and Exchange Commission (SEC) and

the Stock Exchange of Thailand (SET)

as follows:

Qualifi cations of independent directors

1. Does not hold more than 0.5% of the

total outstanding voting shares of

the Company, its parent company,

subsidiary or affi liated company, or

juristic entity that may constitute a

confl ict of interest. This is inclusive

of the shares held by his/her related

persons.

2. Over the past two years, has not held

a director position, regular employee,

staff member or consultant on the

payroll of the Company, its parent

company, subsidiary or affiliated

company, a same-level subsidiary,

or juristic entity that may constitute

a confl ict of interest.

3. Is not be related by blood or by legal

registration as parents, spouse, sibling,

children or spouses of children of

the executive, major shareholder,

controller, or person nominated

as an executive or controller of the

Company or subsidiary companies.

4. Over the past two years, has had no

direct or indirect business relation

with the Company, i ts parent


company, or juristic entity that may

cause conflict with independent

decisions. Over the past two years,


he/she must also never have been a

major shareholder, non-independent

director or executive of those who

with business connections with

its parent company, subsidiary or

affi liated company, or juristic entity

that may cause a confl ict of interest.

The term ‘business relationship’

under the above paragraph includes

any normal business transaction,

rental , or lease of immovable

properties, transaction relating to

assets or services, or grant or receipt of

fi nancial support through receiving

or extending loans, guarantee,

providing assets as collateral ,

including any other similar action

whose value exceeds 20 MB or

more than 3% of the net tangible

assets, whichever is lower. The

value of each transaction is based

on the calculation method for the

values of connected transactions

under a Notification of the Board

of Governors of SET Re: Disclosure

of Information and Act of Listed

Companies concerning Connected

Transactions. Under the regulation,

all transactions occurring within a

year of preceding transactions must

be included in such calculation.

5. Over the past two years, has never

been appointed as an auditor of

the Company, its parent company,

subsidiary or affiliated company,

or juristic entity that may cause a

confl ict of interest. Over the past two

years, he/she must not be a major

shareholders, non-independent

director, executive, or partner of an

auditing company whose offi cer is

auditing the Company, its parent



cause a confl ict of interest.

6. Over the past two years, has never

provided any professional service,

including legal or fi nancial advice,

earning more than 2 MB annually

from the Company, its parent



cause a conflict of interest. If the

professional service provider is a

juristic person, he/she must not be its

major shareholder, non-independent

director, executive, or managing

partner.

7. Is not appointed to represent directors,

major shareholders, or any shareholders

related to CPN’s major shareholders.

8. Does not possess other characteristics

that could prevent him/her from

giving independent opinions

concerning CPN’s operation.

After the appointment, an independent

director may be assigned by the Board

to make a collective decision on the

operation of the Company, its parent

company, subsidiary or associated

company, or juristic entity with potential

confl icts.

Company Secretary

The Board of Directors is responsible

for appointing a person, who has the

appropriate knowledge and ability, to be

the Company Secretary; whereby the

current Company Secretary is Ms. Naparat

Sriwanvit who has the full facilities of

the offi ce of the Company Secretary to

effectively and efficiently support her

responsibilities in accordance with the

good corporate governance principles.

Duties and responsibilities of the

Company Secretary

1. Prepare and maintain all documents

relating to the Company’s statutory

register of directors, Annual Reports,

notices and minutes of the meetings

of the Board of Directors, as well

as notices and minutes of the

shareholders’ meetings.

2. Maintain and keep a record of vested

interests as reported by directors and

executives.

3. Send copies reporting vested interests

of directors and executives or related

persons to the Chairman of Audit

Committee within seven days of the

receipt of each report.

4. Organize Board and shareholders’

meetings according to rules and

applicable laws.

5. Provide advice to CPN and the Board

of Directors in conformance to

CPN’s memorandum of association,

articles of association, Securities

and Exchange Act, Public Company

Limited Act, and applicable laws.

6. Act as the clearing house between the

Board of Directors, executives, and

the shareholders.

7. Coordinate and follow up the Board’s

and shareholders’ resolutions.

8. Ensure that appropriate information

disclosure and information reports

are submitted to the regulators as

required.

9. Perform other duties as required by

the regulations of the Capital Market

Supervisory Board or as assigned by

the Board of Directors.

Legal Office is responsible for the

preparation of the minutes of meetings of

the Board of Directors and shareholders,

as well as monitoring and provision of

advice to the Company and the Board

of Directors to ensure full compliance.

Sub-Committees

Audit Committee

The Board of Directors is responsible for

the appointment of members of the

Audit Committee, which comprises as

follows :

>> 4 independent directors

>> The fi rst member below has adequate

knowledge and experience in

reviewing reliability of financial

statements.


of the Audit Committee are as follows :

1. Mr. Paitoon Taveepol,

Chairman

2. Mr. Chackchai Panichapat,

Member

3. Mrs. Sunandha Tulayadhan,

Member

4. Mr. Karun Kittisataporn 1,

Member

Note :1 Appointed on 21 January 2011

Duties and responsibilities of the Audit

Committee

1. Review the fi nancial report prepara-

tion process for accurate, complete,

credible, and timely information

disclosure by coordinating with

the external auditor and executives

responsible for preparing quarterly

and annual reports.

2. Consider connected transactions

which may cause confl icts of interest;

ensure conformance to SET to ensure

that they are reasonable and in CPN’s

best interests.

3. Consider the accurate and complete

disclosure of information in case of

connected or related transactions or

other transactions that may cause

confl ict of interest.

4. Review the internal control system

for suitability and eff ectiveness.

5. Consider the audit outcomes and

suggestions of the external auditor

and Internal Audit concerning internal

controls and pass on suggestions for

action by the management as well as

following up the implementation of

such suggestions.

6. Review and ensure that Internal Audit

is independent and has an effi cient

internal audit process.


7. Review the activities and structure

of Internal Audit and approve its

charter.

8. Provide suggestions to the appoint-

ment, removal, transfer, commen-

dation or discharge, as well as

compensation of the head of Internal

Audit.

9. Review the internal audit plan with

the head of Internal Audit, especially

about the internal control system

and fi nancial management process.

10. Provide suggestions and remarks

about the budget and manpower of

Internal Audit for the management’s

approval.

11. Review audit plans and coordinate

the scope of audit of Internal Audit

and the external auditor to be

mutually supportive and eliminate

redundancy.

12. Select, nominate, and propose fees

for the external auditor for approval so

as to obtain an independent auditor,

taking into account the reliability,

adequacy of resources, audit volume,

the experience of the personnel

assigned to audit the Company as

well as past work. Also, consider the

removal of the external auditor.

13. Review the scope and method of

auditing proposed by the external

auditor as well as reasons for changing

the auditing method (if any).

14. Provide suggestions to the external

auditor to review certain transactions

that may be necessary or important

during the auditing process of CPN

and subsidiary companies.

15. Review the report of the external

a u d i t o r a n d s u b m i t t o t h e

management for adjustments in

practices, as well as following up on

such suggestions.

16. Consider the adequacy and effi ciency

of coordination between the external

auditor and Internal Audit.

17. Act on received information from the

external auditor as soon as possible

regarding suspicious activities of

directors, managers or persons

responsible for operating CPN that

may constitute a breach of the second

paragraph of Section 281/2, Section

305, Section 306, Section 308, Section

309, Section 310, Section 311, Section

312 or Section 313 of the Securities

and Exchange Act. Promptly check

the information received and report

preliminary findings in the first

instance to SEC and the external

auditor within 30 days from the date

when a given breach was reported.

18. Re v ie w c o n f o r m a n c e b y t h e

Company to Securities and Exchange

laws, SET requirements, or CPN

business-related laws.

19. Report its performance to the Board

for consideration at least once every

quarter.

20. Prepare a report of the Committee

in the format required by SET, to be

signed by its Chairman and included

in the annual report.

21. Immediately report to the Board

suspicious transactions that may

constitute a conflict of interest,

fraud, or breach of Securities and

Exchange laws, SET requirements,

or CPN business-related laws and

may seriously aff ect CPN’s fi nancial

status and performance. If the Board

or the management do not correct

the problem within a reasonable time

limit, the Committee may report it to

SEC or SET.

22. Review CPN’s continual process of

good corporate governance as well

as providing approaches and advice

for development.

23. Emphasize and promote good

corporate governance as a regular

agenda for Board meetings and

AGMs.

24. Ensure that the Chairman of the

Committee receives a copy of the

report of the directors’ vested interests

from the Company Secretary under

Article 89/14 of the Securities and

Exchange Act within seven days

of the date when CPN receives the

report.

25. Review CPN’s risk management

process to ensure standardization,

eff ectiveness, and effi ciency.

26. Work with the Risk Management

Committee, the Risk Management

task force, and the management in

considering, making recommen-

dations on, and updating reports on

CPN’s risk management.

27. Conduct other Board-assigned duties

with the concurrence of the Audit

Committee. The Committee is liable

to the Board for its Board-assigned

duties and responsibilities, whereas

the responsibility for all CPN activities

to others is still that of the Board.

28. Regularly review on an annual basis

the Audit Committee Charter, in order

to consider and assess its current

assigned roles and responsibilities

as well as to propose any required

amendments accordingly.

29. Oversee that there is an effective

whistleblower system in place, in

the event that an employee or any

stakeholder is suspicious of any

possible wrongdoing as well as non-

compliance to any laws, regulations,

business ethics, or to any corporate

governance principles, so that the

whistleblower has the confi dence that

the Company has the required and

appropriate independent procedure

to eff ectively investigate and resolve

such possible wrongdoings and

non-compliance issues.

Nomination and

Remuneration Committee


for the appointment of the members

of the Nomination and Remuneration

Committee, which comprises as follows :

>> 3 independent directors and one

non-executive director

>> The Chairman is an independent

director.



Committee are as follows:

1. Mr. Chackchai Panichapat, Chairman

2. Ms. Sunandha Tulayadhan, Member

3. Mr. Karun Kittisataporn, Member

4. Mr. Kanchit Bunajinda, Member

Three advisors to the Committee are

appointed as follows:

1. Mr. Sudhisak Chirathivat, Advisory

2. Mr. Sudhitham Chirathivat, Advisory

3. Mr. Prin Chirathivat, Advisory

Duties and responsibilities

of the Nomination Committee

1. Consider the appropriate structure,

size, and composition of the Board to

suit the organization and changing

environment.

2. Consider the criteria for selecting

directors, President & CEO, as well as

select and nominate those persons

qualified and appropriate to be

considered by the Board of Directors

for appointment as directors or the

President & CEO.

3. Allow minority Shareholders the

opportunity to propose qualified

persons for selection as directors. This

provided shareholders with enough

time prior to shareholders’ meetings

being held.

4. Ensure that the policy, plans, and

strategies for human resources align

with the Company’s business.

5. Consider appropriate strategies

re lat ing to human resources

management to be implemented

to ensure its consistency with the

Company’s business operations.


Duties and responsibilities

of the Remuneration Committee

1. Consider a clear compensation

method and standard for directors,

members of the sub-committees

as well as that for the President

& CEO, so that they are equitable

and appropriately corresponds to

the respective assigned duties and

responsibilities, current business

environment and performance

results of the Company, as well as

will facilitate an eff ective discharge

of their responsibilities. The proposed

compensation plan should also

be comparable to those of other

companies within the same or

similar industry and business sector

as the Company, and also take into

consideration the overall increase

to the total value of the shareholders

equity in the long term.

2. Consider the compensation for

directors and propose it to the Board

for endorsement and, in turn, tabling

it for the approval of shareholders’

meetings.

3. Define goals and evaluate the

performance of the President & CEO

to set reasonable compensation.

Risk Management Committee

The Board of Directors is responsible for

the appointment of the members of the

Risk Management Committee, which

consists of 5 members, comprising as

follows :

>> 4 directors and one senior executive

>> The Chairman is an independent

director.


of the Risk Management Committee are

as follows :

1. Mr. Paitoon Taveebhol, Chairman

2. Mr. Kobchai Chirathivat, Member

3. Mr. Prin Chirathivat, Member

4. Mr. Kanchit Bunajinda, Member

5. Mr. Naris Cheyklin 1, Member

Note :1 Senior Executive Vice President, Finance, Accounting and Property Management

Duties and responsibilities of the Risk


1. Consider the policies, strategies,

structures, and organization frame-

work of a corporate risk management

system.

2. Provide support to senior executives

by defi ning the structure of corporate

risk management; evaluate all

dimensions of risk factors that may

aff ect CPN’s business.

3. Review risks, and follow up and

evaluate the adequacy, efficiency,

and effectiveness of overall risk

management.

4. Master the risks that may severely

aff ect the organization and ensure

proper management measures

taken.

5. Provide advice and endorsement of

corporate risk management.

The management has also established a

risk management task force (commit-

tee) at the operating level, comprising

executives from various related areas,

with the manager of each shopping

center as the risk manager. The secretary

to the Risk Management Committee

must coordinate the communication of

key risks to the risk management task

force so that they can apply comprehen-

sive risk management strategies to their

regular work.



for the appointment of members of

the Corporate Governance Committee,

consisting of a total of 6 members,

comprising as follows :

The names and positions of the

members of the Corporate Governance

Committee are as follows :

1. Mr. Naris Cheyklin, Chairman

2. Ph.D. Nattakit Tangpoonsinthana,

Member

3. Ms. Naparat Sriwanvit, Member

4. Mrs. Suwadee Singngam, Member

5. Ph.D. Suchart Otaivites, Member

6. Mr. Uthai Kongkittiwong, Member



1. Defi ne and revise policies, require-

ments, and work procedures under

good corporate governance prin-

ciples.

2. Defi ne policies and plans regarding

corporate social responsibility (CSR).

3. Meet every quarter to follow up

CPN’s corporate governance and CSR

plans as well as providing advice and

essential support to the Corporate

Governance task force.

4. Assess internally using corporate

governance criteria to identify areas

for improvement.

5. Represent CPN in communication and

undertaking corporate governance

activities with the management,

employees, and external organi-

zations.

Moreover, the Corporate Governance

Committee has established a task force

to promote and publicize corporate

governance, with representatives from

each department responsible for the

following duties :

1. Determine an action plan for pub-

licizing and promoting awareness

of corporate governance and CSR

among all executive and employees.

2. Educate all executives of their roles

in corporate governance and social

responsibility.

3. Follow up, review, and improve on

performances against plans, and

submit a summary for the Corporate

Governance Committee every

quarter.

Executive CommitteeThe Board of Directors is responsible

for the appointment of members of the

Executive Committee, which consist

of a total of 6 members, comprising as

follows :

The names and positions of the

members of the Executive Committee

are as follows :

1. Mr. Suthichai Chirathivat,

Executive Chairman

2. Mr. Suthikiati Chirathivat, Member

3. Mr. Suthichart Chirathivat, Member

4. Mr. Sudhisak Chirathivat, Member

5. Mr. Sudhitham Chirathivat, Member

6. Mr. Prin Chirathivat, Member


Executive Committee

1. Screen the following for the Board of

Directors for approval :

1.1 CPN strategic plans

1.2 Annual budget estimates, based

on CPN’s strategic plans

1.3 Capital expenditure budget

exceeding 200 MB

1.4 Activities and operations con-

cerning mergers and acquisitions

1.5 Appointment of the President &

CEO

2. Monitor CPN’s performance under

the budget and goals.

3. Approve transactions with banks

and financial institutions that

constitute normal CPN’s business.

4. Approve transactions with subsidiary

companies and investment in

securities as assigned by the Board

of Directors.

5. Approve notaries rights and legal

transactions concerning all CPN

shopping centers and subsidiaries

that constitute or support normal

business.


6. Approve the participation in MOU

(memorandum of understanding)-

Joint-Venture Agreement under

various investment projects and

joint-venture agreement worth up

to 200 MB in investment value.

7. Approve the establishment, increase

or decrease in accounting reserves

such as provisions for doubtful

accounts, provisions for losses

from depreciated investment, and

provisions for losses during project

development for up to 100 MB.

8. Approve the allocation of net income

for legal reserve provisions.

9. Approve capital expenditure of up to

200 MB.

10. Be responsible for human resource

management of senior executives.

11. Promote and motivate employees.

12. Approve other Board-assigned

transactions on a case-by-case basis.


The Management Committee consists

of 9 members :

1. Mr. Kobchai Chirathivat,

President & CEO

2. Mr. Sudthidej Chirathivat,

Senior Executive Vice President

3. Mr. Naris Cheyklin,

Senior Executive Vice President,

Finance, Accounting

and Property Management

4. Mr. Suthipak Chirathivat,

Executive Vice President,

Offi ce of the President

5. Ms. Wallaya Chirathivat,

Senior Executive Vice President,

Business Development and

Project Construction

6. Mrs. Narttaya Chirathivat,

Executive Vice President, Leasing

7. Mr. Terachart Numanit,


Project Construction

8. Ph.D. Nattakit Tangpoonsinthana,

Executive Vice President, Marketing

9. Mrs. Panida Sooksridakul,

Acting Executive Vice President,

Property Management



1. Prepare and propose strategic

business plans.

2. Prepare and propose annual budget

estimates.

3. Present operating expenditure over

50 MB.

4. Nominate the President & CEO’s

direct reports.

5. Consider the approval of various

operations for the Board of Directors

and the Executive Committee as

assigned.

5.1 Bank and fi nancial transactions

that constitute normal business.

5.2 Transactions with subsidiary

companies and investment

in securities as assigned by the

Board of Directors and the

Executive Committee.

5.3 Action on notaries rights and

legal transactions concerning

all CPN shopping centers and

subsidiaries that constitute or

support normal business.

5.4 Approve capital expenditure of

up to 50 MB.

5.5 Perform other transactions as

may be assigned by the Board

of Directors or the Executive

Committee.

Summary of the appointment of directors on sub-committees

Name of Director Board of Audit Nomination and Risk Directors Committee Remuneration Management Committee Committee

1. Mr. Suthichai Chirathivat C - - -

2. Mr. Paitoon Taveebhol M C - C

3. Mr. Chackchai Panichapat M M C -

4. Mrs. Sunandha Tulayadhan M M M -

5. Mr. Karun Kittisataporn 1 M M M -

6. Mr. Kanchit Bunajinda M - M M

7. Mr. Suthikiati Chirathivat M - - -

8. Mr. Suthichart Chirathivat M - - -

9. Mr. Sudhisak Chirathivat M - A -

10. Mr. Sudhitham Chirathivat M - A -

11. Mr. Prin Chirathivat M - A M

12. Mr. Kobchai Chirathivat M - - M

Note:C - ChairmanM - MemberA - Advisory1 Appointed to Audit Committee on 21 January 2011


Nomination of Directors

Term

In accordance with the Public Company

Limited Act, and the Company’s articles

of association, it is required that one-third

of the directors must leave the Board

at every Annual General Meeting of

Shareholders (AGM). If the total number

is not a multiple of three, the number

closest to one-third must be used with

the exit of directors who have stayed

the longest with the Board, who may be

re-elected to the Board.

Independent directors may hold the

position for no more than two consecutive

terms, with a possible extension of one

more term.

Criteria for nomination

Recruitment of directors is the respon-

sibility of Nomination and Remuneration

Committee, which screens candidates

with qualifications predetermined in

the Company’s articles of association

and tables them to the Board for con-

sideration before further submission

to shareholders’ meetings to decide

and appoint them under the following

methods:

1. In voting for directors, each share carries one vote.

2. Each shareholder must exercise all of his/her voting rights to elect the proposed candidates one by one.

3. The candidates with the top votes and those in descending order will become directors, with the number of successful candidates equal to the number of directors required or to that to be elected at a given meeting. The chairperson of the meeting casts

his/her deciding vote if more than

one candidate receive equal votes.

In case of a vacant position due to causes

other than term completion, the Board

must appoint qualified and lawful

candidates as replacement directors

at the next Board meeting unless the

remaining term is shorter than two

months. Each replacement serves in such

position only for his/her predecessor’s

remaining term. For the appointment

of the replacement, he/she must receive

no less than three-quarter of the votes

from the remaining directors.

The Company allows all shareholders the

opportunity to participate in proposing

persons for consideration as possible

nominees for appointment as a Director

of the Company. This is to take place at

least 3 months prior to the end of the

fi nancial year, whereby the Company

makes the announcement, together

with the details of procedure for the

nomination and consideration, through

the Stock Exchange of Thailand’s

information disclosure system as well

as through the Company’s website.

No shareholder proposed any person to

be nominated as a director of the

Company in 2011.

Orientation for newly-appointed

Directors

For newly appointed directors, lastest in

2009, CPN had arranged a meeting among

new and existing ones, including CPN’s

management team. An orientation was

held to develop a better understanding

of their roles and to present Company’s

business, as follows, to the new directors :

1. CPN’s goals, vision, and strategies

2. Summary of CPN’s group structure, organizat ion chart , and sub-committees

3. Summary of CPN’s business nature

4. Summary of CPN’s shareholding structure

5. Summary of CPN’s pol icy on connected transactions

6. Summary of CPN’s performance, recent projects, and projects under construction to provide new directors with adequate basic information to perform their duties effi ciently

7. CPN’s site visit.

NOMINATION OF DIRECTORS AND MANAGEMENT

Additionally, the offi ce of the Company

Secretary has prepared and provided

the following documents to the new

directors :

1. Director’s manual, consisting of CPN’s vision, mission, and values; corporate governance policy; code of conduct for directors, executives, and employees; CPN’s articles of association; charters of the Board of Directors and sub-committees; manual of l i s ted companies ’ directors; suggestions for disclosure of information; and applicable laws

2. Company profi le

3. Regulations on the CPN’s internal information control

4. Regulations on the CPN’s securities portfolio

5. Policy on reporting of directors’ and executives’ vested interests and relevant forms for report preparation

6. The latest annual report

7. Board meeting minutes dating back one year

8. Performance reports of the Audit

Committee dating back one year.

Nomination of Management

Nomination of President & CEO

The Executive Committee conducts a

preliminary screening of candidates

with the required qualif ications,

knowledge, skills, and experience and

then tables them to the Nomination

and Compensation Committee for

consideration and endorsement before

submitting the final list to the Board

for its consideration.

Nomination of Management

The President & CEO selects and appoints

candidates with the qualifications,

knowledge, skills, and experience

suitable for each executive position. The

recruitment will be done under Human

Capital Management’s regulations.

Succession Plan

CPN has in place a succession plan

to ensure the stability and continuity

of the Company’s business operation,

whereby the following actions have

been implemented:

1. CPN Leadership DNA Program for the senior management that aims to enhance the leadership potential and characteristics of the leader of CPN

2. Leadership Program that aims at defi ning a well-set out career advance-ment path that also responds to the future business growth of CPN whereby there are 2 programs :

2.1 L e a d e r s h i p D e v e l o p m e n t Program for executives for senior management

2.2 Young Leadership Program for middle management

3. Individual Development Plans (IDP) Program that focuses on the ongoing development of employees

in accordance with their responsi-

bilities.

CPN is confident that the above –

mentioned succession plan will enable

the Company to develop the potential

capabilities of its employees as well

as support an effective and efficient

nomination process. Additional details

appear under Human Capital Develop-

ment on page 100.

CentralWorld

REMUNERATION OF DIRECTORS AND MANAGEMENT

Remuneration of Directors

CPN has considered the remuneration

of directors, taking into account both

its fairness and appropriateness, which

reflects the extent of their responsi-

bilities and performance relative to the

Company’s overall operational perfor-

mance and related factors, inclusive of

comparisons to remuneration of other

companies within the same or similar

industry and business sectors as the

Company; whereby the Nomination

and Remuneration Committee has

annually considered from the survey on

remuneration of directors undertaken

by the Stock Exchange of Thailand

(SET) and the Thai Institute of Directors

Association (IOD) as reference.

In 2011, the Nomination and Remune-

ration Committee has reviewed and

proposed the remuneration of directors

to the Board of Directors for consideration

and concurrence in submitting it to

the 2011 Annual General Meeting of

Shareholders on 29 April 2011 for

approval, whereby the total approved

amount of remuneration of directors is

as follows :

Type of Remuneration Amount (Baht)

1. Quarterly Retainer (Baht/Quarter)

> Chairman 120,000

> Chairman of the Audit Committee 110,000

> Audit Committee Member 85,000

> Director 70,000

2. Board Meeting Allowance for Board of Directors (Baht/Meeting)

> Chairman 50,000

> Director 35,000

3. Meeting Allowance for Audit Committee (Baht/Meeting)

> Chairman of the Audit Committee 60,000

> Audit Committee Member 45,000

4. Meeting Allowance for Nomination and Remuneration 20,000

Committee including Advisory (Baht/Meeting)

5. Meeting Allowance for Risk Management Committee 20,000

(Baht/Meeting)

Total Remuneration for the Directors as approved 10,500,000

by the shareholders

Note: Executive director and management do not receive any remuneration for being members of any sub-committees.

The quarterly retainer for the directors together with meeting allowances for sub-

committees for 2011 totaled Baht 9,030,000, whereby details of meeting attendance

and remuneration are as follows :


Meeting Attendance and Remuneration of the Directors in 2011

Name of Directors Position Meeting Attendance (Meeting)

Board Audit Nomination and Risk

of Director Committee Remuneration Management

Committee Committee

7 Meetings 11 Meetings 2 Meetings 1 Meetings

1. Mr. Suthichai Chirathivat Chairman 7/7 - - -

2. Mr. Paitoon Taveebhol Director 7/7 11/11 - 1/1

Audit Committee Chairman

Risk Management Committee Chairman

3. Mr. Chackchai Panichapat Director 7/7 11/11 2/2 -

Audit Committee Member

Nomination and Remuneration Committee Chairman

4. Mrs. Sunandha Tulayadhan Director 7/7 10/11 2/2 -


Nomination and Remuneration Committee Member

5. Mr. Karun Kittisataporn Director 6/7 9/10 (1) 2/2 -


Nomination and Remuneration Committee Member

6. Mr. Kanchit Bunajinda Director 7/7 - 2/2 -/1

Nomination and Compensation Committee Member

Risk Management Committee Member

7. Mr. Suthikiati Chirathivat Director 6/7 - - -

8. Mr. Suthichart Chirathivat Director 7/7 - - -

9. Mr. Sudhisak Chirathivat Director 7/7 - 2/2 -

Nomination and Remuneration Committee Advisory

10. Mr. Sudhitham Chirathivat Director 7/7 - 2/2 -


11. Mr. Prin Chirathivat Director 7/7 - 2/2 1/1



12. Mr. Kobchai Chirathivat Director 6/7 - - -/1


Total

Remarks: (1) Appointed as a member of the Audit Committee on 21 January 2011.

Remuneration of Management

CPN has considered the remuneration

of management, taking into account

both its fairness and appropriateness,

which also reflects the Company’s

overall operational performance as

well as that of each performance and

comparable to the remuneration of other

companies within or in similar industry

and business sectors as the Company,

whereby the total remuneration paid to

the management for 2011 are as follows :

>> Salaries and Bonuses

CPN contributed remuneration in

form of salaries and bonuses paid

to nine executive managements in

2011 amounted to Baht 64,253,479.

>> Provident Fund

CPN contributed the Provident Fund

paid to seven executive managements

in 2011 amounted to Baht 3,073,236.

Director Remuneration (Baht)

Quarterly Meeting Meeting Meeting Allowance Meeting Total

Remuneration Allowance Allowance for Nomination Allowance for Risk (Baht)

for Board for Audit and Remuneration Management

of Directors Committee Committee Committee

480,000 350,000 - - - 830,000

440,000 245,000 660,000 - 20,000 1,365,000

340,000 245,000 495,000 40,000 - 1,120,000

340,000 245,000 450,000 40,000 - 1,075,000

340,000 210,000 405,000 40,000 - 995,000

280,000 225,000 - 40,000 - 545,000

280,000 190,000 - - - 470,000

280,000 225,000 - - - 505,000

280,000 225,000 - 40,000 - 545,000

280,000 225,000 - 40,000 - 545,000

280,000 225,000 - 40,000 20,000 565,000

280,000 190,000 - - - 470,000

3,900,000 2,800,000 2,010,000 280,000 40,000 9,030,000


CONNECTED TRANSACTIONS

CPN’s core business is provision of retail

space rental, other relevant businesses,

and promotion of the Company’s

business operation. The long history of

success during its business operation

is partly due to the fact that CPN is one

of business lines within Central Group,

the leader in retail business for over six

decades. Central Group encompasses

various businesses, ranging from

department stores, hotels, restaurants,

to retail shops of hundreds of brands

and products, which are anchor and

retail tenants within CPN’s shopping

complexes. It can be said that the alliance

businesses within Central Group support

CPN to increase its rental rate and build

confi dence among other prospects to

become new tenants. These help

guarantee the success of CPN’s projects

and therefore, the high profi ts are yielded

to CPN shareholders from such mutual

relationship explained above. In fact,

CPN and Central Group are two related

business alliances, and such alliance

businesses create synergies that benefi t

CPN. The Board of Directors and Audit

Committee ensure that the transaction

is in compliance with the relevant law,

regulations, and rules. A clear policy

of connected business is set, price and

condition are deliberated in accordance

with normal business practice, the related

transaction is occasionally summarized

for the Audit Committee, the approval

is sought under the regulations of

Securities and Exchange Commission

(“SEC”) and the information is disclosed

to Stock Exchange of Thailand (“SET”).

CPN and its subsidiaries conducted

transactions with connected parties

with potential conflicts of interest, as

disclosed fi nancial statements of 2011.

Most of the connected transactions

were engaged with Central Holding

Co., Ltd., and the Chirathivat Group as

described below:

Connected Transactions with Related Parties

1. Revenue from connected parties

comprises revenue from space rental

and utility service fee in shopping

complexes, revenue from land rental,

and management fees, as well as

revenue from other sources, including

insurance premiums, property taxes,

sales promotion expenses, warrant fees,

commissions, and other fees for various

services collected from connected

parties. Total amount of revenue from

connected parties in 2011 was 1,965 MB.

Justifi cation and Rationale

for Connected Transactions

CPN’s core business is the provision of

space for rent and services in shopping

complexes, offi ce buildings, residential

condominiums, food centers, water

parks, and recreational parks located

on the premises of shopping complex

projects. The company is also the provider

of utility services in shopping complexes.

Various businesses in the Central Group

are inter-related and complementary

of one another – department stores,

supermarkets, retail shops, and various

leading branded restaurants. Most of the

revenue is earned from doing business

under normal business conditions and

under general commercial conditions

made with the Central Group, with high

growth potential and secure fi nancial

status. In addition, businesses under

popular brands, including department

stores, supermarkets, retail shops and

restaurants, can draw more customers

to CPN’s shopping complexes. This,

as a consequence, produces higher

returns to CPN and its shareholders. The

Company’s policy on the rates of rental

and services collected from connected

parties are as follows:

> Rates of rental, service fees, and utility

fees from space rental in shopping

complexes collected from businesses

are based on market prices. Compared

with other space for rent in the vicinity,

or in the same class, CPN’s rental rates

and service fees are comparable. Rental

rates are subject to locations, area sizes,

forms, periods, and categories, and are

in line with normal business practice

following the condition of general

trading.

> Other types of revenue come

from the collection of insurance

premiums, property taxes, sales

promotion expenses, warrant fees,

and other service fees from tenants

in shopping complexes. CPN’s policy

is to standardize revenue collection

from both connected parties and

general customers, based on the actual

cost, space rental category, and the

usual business practice following the

condition of general trading.

> Revenue from land lease occurs at

some properties where CPN and other

companies in the Central Group have

a project on the same piece of land,

taking into account the marketing

advantage and the size of the project.

In this case, one of the companies

in the Group will act as the buyer or

tenant of the whole piece of land from

the landlord and will divide the land

into various sizes as needed by other

companies, and have those companies

lease or sub-lease. The rental is the cost

plus actual interests or market price

which evaluated by the independent

appraiser. Furthermore, the Company’s

assets were evaluated under SEC,

SET and other related regulations and

transactions concerning revenue from

land leases are verifi ed by the auditor.

> Revenue from large space rental in

shopping complexes is agreed at the

stage of project design. Rental is derived

from the costs of land and construction

plus actual interests as well as operating

expenses. Most transactions in this

category were conducted before the

listing of the Company on SET. The

Company’s assets were evaluated

under SET regulations and transactions

concerning income from large space

rental are verifi ed by the auditor.

Details of Revenue Derived from Connected Parties

Connected Party Amount Detail (MB)

1.1 Central Retail Corporation Co., Ltd. 1,021 - CPN earns revenue from rental, service fees, utility fees, and other revenue

(“CRC”) from leasing retail areas in shopping complexes to various retail businesses

(Majority share held under the CRC Group. The transactions in this category occur in the

by the Chirathivat Group) course of normal business following the condition of general trading.

1.2 Central Marketing Group Co., Ltd. 270 - CPN earns revenue from rental, service fees, utility fees, and other revenues

(“CMG”) from leasing sales areas in shopping complexes to various retail businesses

(Majority share held under the CMG Group. The transactions in this category occur in

by the Chirathivat Group) the course of normal business following the condition of general trading.

1.3 The Central Plaza Hotel Plc Group 80 - The Thai Business Fund 4 has made a sub-lease contract with Central World

of Companies (“CHR”) Hotel Co., Ltd. for land and part of the building in the premises of CentralWorld

(Majority share held Project with land area 2.53 rai. Under the contract, which is valid for

by the Chirathivat Group) 29 years until 2032, CHR agreed to use the mentioned land and building

for the development of a hotel, a parking lot, and a convention hall. The rental

is calculated by the cost plus actual interests and paid to CPN into two parts,

one of which is the rental that was paid in the year when the agreement

was signed and the other is the annual rental.


Connected Party Amount Detail (MB)

- CPN earns revenue from rental, service fees, utility fees, and other revenues

from leasing sales areas in shopping complexes and offi ce building to

laundry businesses under the CHR Group included the revenue rental

area of Bangkok Convention Center which located in the CentralPlaza

Lardprao. The transactions in this category occur in the course of normal

business following the condition of general trading.

1.4 Central Restaurant Group Co., Ltd., 153 - CPN earns revenue from rental, service fees, utility fees, and other revenues

(“CRG”) from the lease of space in shopping complexes to businesses in CRG. The

(Majority share held transactions in this category occur in the course of normal business

by the Chirathivat Group) following the condition of general trading.

1.5 Other businesses which related 440 - CPN earns revenue from rental, service fees, utility fees, and other revenue

parties of CPN are serve as major from the lease of space in shopping complexes to other companies in

shareholders, directors, management which CPN directors share or hold a director position, such as Fuji Japanese

or controlling persons Restaurant, Zen Japanese Restaurant, AKA, Bar-B-Q Plaza, Body Shop,

Thai Privilege Health Care Spa, Sakura Restaurant, Lee Coopers, Ragazze,

etc. The transactions in this category occur in the course of normal business

practice following the condition of general trading.

- Central Pattana Khonkaen Co., Ltd. has made a sub-lease contract with

Big C Fairy Co., Ltd., with land area of 21-0-33 rai. Under the contract, which

is valid for 30 years ended on 16 June 2026, the lessee developed the

mentioned land to parking lot. The rental is calculated by the cost plus

actual interests which paid to CPN every year.

Remark: 1) CRC consists of various retail businesses, which comprises Central Department Store, Robinson Department Store, Zen Department Store, Tops Supermarket, PowerBuy, B2S, SuperSports, Homework, Offi ce Depot (franchise), Marks & Spencer (franchise), Watson (joint venture), Muji (franchise) etc.2) CMG consists of import, manufacturing, distribution, and sale of consumer goods bearing both international and house brands. These retailers are: 2.1) Apparels : such as 5cm, Benetton, Dorothy Perkins, Energie, Evoluzine, Hush Puppies, FCUK, G2000, izzue, Jockey, Lee, Miss Selfridge, Wrangler, Topshop Topman, Sasch, etc. 2.2) Cosmetic : such as CLARINS, Elizabeth Arden, Laura Mercier, PAYOT, H2O+, etc. 2.3) Watches : such as Guess, Casio, Marc Ecko, Nautica, etc. 2.4) Miscellaneous : such as Samsonite, Pentax, Prince, Casio, Kawai, etc.3) CHR operates hotels and resorts in Centara Group.4) CRG operates Quick Service Restaurants in various brands such as Mister Donut, KFC, Auntie Anne’s, Pepper Lunch, Beard Papa’s, Chabuton, Cold Stone Creamery, RYU Shabu Shabu, Yashinoya, Ootoya, The Terrace, etc.

2. Expenses paid to connected parties

comprise expenses for space rental in

shopping complexes, land rental, and

management fees. In 2011, CPN paid

altogether 549 MB to connected parties.

Justifi cation and Rationale for

Connected Transactions

> Rental of land from connected

businesses occurs in projects where

CPN and other companies in the

Central Group have a joint development

plan on the same piece of land, taking

into account the marketing advantage

and the suitable size of the project. In

this case, one company will act as the

buyer or tenant of the land from the

landlord and will divide the land into

diff erent sizes as required for leasing or

sub-leasing. The rental will be the cost

plus actual interests or market price

which evaluated by the independent

appraiser. The Company’s assets

were evaluated under SEC, SET and

other related regulations. In addition,

the transaction concerning rental

payments are verifi ed by auditor.

> Large space rental in shopping

complexes occurs in projects where

CPN has a joint investment with

a department store in the Central

Group. The building will be divided

into two parts, the shopping complex

and the department store. In some

cases, CPN will rent large space in a

department store and develop it into

a sales area, considering mainly the

revenue from rental and service fees

compared with the cost of space

rental that CPN has to repay the

department store. An agreement

on the cost of large space rental is

reached at the stage of project design

under the same criteria as those used

for large space rental to connected

businesses. Most such transactions

occurred before the listing of the

Company on SET. The Company’s

assets were evaluated under SEC,

SET and other related regulations. In

addition, the transaction concerning

rental payments of large space rental

are verifi ed by auditor.

> Hiring a connected business as

management consultant CPN’s

consideration to hire a management

consultant is mainly based on its

experience in the retail business

and the understanding of the nature

and strategies of the business. The

management fees paid to management

consultant, who is also the Company’s

connected business, are the actual

expenses the service provider incurs

in its services.

> The application for insurance with a

connected business is considered the

market price and conditions or the

best coverage off ered from insurance

agents by compare the price in the

past 2 years. In case of only one

insurance agent make a quotation,

the Company shall consider by

compare the price in the past year,

it depend on the conditions and

insurance market situation.

Expenses paid to connected parties

2.1 CPN rents land from Central

Department Store Co., Ltd., the

company in CRC which Chirathivat

Group is major shareholder, to

launch shopping complexes in

C e n t r a l P l a z a R a m i n d r a a n d

CentralPlaza Pinklao projects.

2.2 CPN sub-rents land from Central

Pattaya Co., Ltd., the subsidiary of

Big C Superstore Plc . which

C h i r a t h i v a t G r o u p i s m a j o r

shareholder, to launch a shopping

complex in Central Center Pattaya

Project (ownership of the land is

held by an individual).

2.3 CPN rents parts of the buildings

belonging to Central Department

Store Co., Ltd., which Chirathivat

Group is major shareholder, in

CentralPlaza Lardprao, CentralPlaza

Pinklao, and CentralPlaza Ratchada-

Rama III projects for development

into retail areas in addition to the

parts where CPN holds land

ownership or land rental rights.


2.4 CPN sub-rents some part of land

and building in CentralPlaza

Lardprao from Central International

Development Co., Ltd. (“CID”),

which Chirathivat Group is major

shareholder (ownership of the

land is held by the State Railway

of Thailand. Under the sub-lease

contract which is valid for 20 years

ended on 18 December 2028. Total

sub-lease payment that CPN will

pay to CID according to the contract

is 16,178.32 MB. This transaction

was approved by the shareholders

with no confl ict of interest in the

EGM No.1/2009 on 25 March 2009.

2.5 CPN hired Central Department Store

Co., Ltd. (“HCDS”) which Chirathivat

Group is major shareholder, to manage

the business, provide management

consultation, set up policies, and

provide recommendations for

running businesses. The directors

with no conflict of interests and

the Audit Committee have agreed

that the service provided by HCDS

is beneficial to CPN’s business

operation due to HCDS’s experience,

knowledge and understanding

in retail business. In addition, the

offered terms and conditions of

the agreement from HCDS are

reasonable. The transaction details

were disclosed to the Stock Exchange

of Thailand on February 25, 2010.

2.6 Centara Udonthani Hotel (formerly

named “Charoensri Grand Hotel”)

which CPN acquired accompany

with the CentralPlaza Udonthani

Project (formerly named “Charoensri

Plaza”) since 2009, hired Central

Plaza Hotel Co., Ltd. the subsidiary

of CHR, which Chirathivat Group

is major shareholder, to manage

the hotel. The management fee is

according to the market price and

comparable to the transaction with

the other persons.

2.7 CPN purchased some merchandises

and services from the businesses

in Central Group; CRC such as

purchasing office supplies, CHR

such as rental room and service in

the hotel included food and beverage,

CRG such as purchasing food and

beverage, and other businesses

which related parties of CPN are

serve as major shareholders, directors,

management or controlling persons.

The transactions in this category

occur according to support normal

business and following the condition

of general trading that comparable

to the transaction with the other

persons.

2.8 CPN took out insurance for shopping

complexes and office buildings

against any accidents, disasters, and

other detrimental incidents with CG

Broker Co., Ltd., which Chirathivat

Group is major shareholder.

3. Loans between CPN and connected

parties

Policies on loans between CPN

and connected parties

All loans must comply with the

following policies on loans between

CPN and connected parties:

> CPN and subsidiaries (those with

99.99% shares held by CPN)

CPN allows subsidiaries to borrow

from CPN and vice versa if the

subsidiaries have working capital

surplus and CPN needs such money.

In this case, current accounts are set

up with CPN and promissory notes

are prepared as evidence with the

average interest rate of unsecured debt

securities issued by the Company.

Connected transaction approvers

consist of the Vice President for

Finance, the Senior Executive Vice

President for Finance & Accounting,

and the President & CEO, respectively.

> CPN and joint-venture partners (those

with 50 to 99.99% shares held by

CPN)

CPN allows joint-venture partners

to secure their own sources of fund.

In urgent cases, however, they

may borrow from shareholders in

proportion to their shareholding in

CPN. Approval is needed from the

Senior Executive Vice President for

Finance & Accounting, the President

& CEO, and the Board of Directors,

respectively. In this case, promissory

notes are prepared as evidence. As

regards interest rates, the applying

rates are based on commercial banks’

MLR.

> CPN and associated companies

(those with less than 50% shares held

by CPN) or connected parties

CPN has no policy to let associated

companies, with CPN holding less

than 50% shares, or connected parties

borrow from it. In fact, for the past

five years, no such instance has

happened. According to CPN’s

regulations, if a loan is extended to

an associated company, approval is

needed from the Board of Directors

with promissory notes as evidence

and with commercial banks’ MLR

applied.

Loans between CPN and connected parties

Description as at 31 December 2011 Amount Financial (MB) Statements of

3.1 Loans (1)

1) Loans obtained from subsidiaries 4,478 CPN

2) Loans obtained from related parties 4 Consolidated

3.2 Loans (2)

1) Loans granted to subsidiaries 15,761 CPN

2) Loans granted to related parties - Consolidated

Remark: (1) These items without collaterals are payable on demand and carry interest at the average interest rate of unsecured debt securities issued by the Company.(2) These items without collaterals are payable on demand and carry interest at the average interest rate of unsecured debt securities issued by the Company. (except a loan to Central Pattana Khon Kaen Co., Ltd., a subsidiary, which is secured by plots of land owned by the subsidiary)


Approval procedure of connected transactions

All t ransactions with connected

businesses or individuals must go

through an approval process, as stipulated

by the Company’s regulations, in the

same way as normal transactions.

Approvals are given by authorized

persons in each duty and responsibility.

Each person in charge of and involved

in the transaction would have to make

reasonable judgment under the normal

business practice, taking into account

the best interests of the Company

and shareholders, like engaging in

t ransact ions wi th outs iders . Al l

transactions with connected parties

must also be lawfully conducted to

ensure transparency and compliance

with the relevant laws, rules, and

regulations. The Company has instituted

that normal business practice and

supporting normal business practice

with operation under the condition of

general trading set by the Committee are

under the jurisdiction of the operational

task forces to deliberate the transaction

in accordance with the Company’s

approval procedure. Other transactions

are deliberated by its category and size,

with the Offi ce of Company Secretary

taking charge of compliance with SET

regulations as well as occasionally

collecting and summarizing connected

4. Guarantees for loans for connected parties

Justifi cation and Rationale for Connected Transactions

CPN’s policy is to provide loan guarantees for its subsidiaries in proportion to its

shareholding but has no policy of placing assets for such loan guarantees. However,

CPN does provide guarantees as its parent company, and collects commissions from

subsidiaries for such guarantees.

CPN had three categories of guarantee obligations to connected parties:

Description as at 31 December 2011 Amount (MB)

4.1 Guarantees for subsidiaries’ outstanding loans

> Thai Business Fund 5 600

> CPN Pattaya Beach Co., Ltd. 270

> CPN Pattaya Beach Hotel Co., Ltd. 1,000

> Central Pattana Chonburi Co., Ltd. 800

> Central Pattana Nine Square Co., Ltd. 1,700

Total 4,370

4.2 Guarantees for bank overdraft for subsidiaries 24 (1)

4.3 Loan ceiling guarantees for subsidiaries’ public 274

utilities guarantees given to Thai commercial banks

Remark : (1) As at year-end 2011, it was no bank overdraft outstanding.

transactions for the Audit Committee’s

acknowledgment. CPN has announced

its “Connected Transaction Policy” and

communicated to all relevant parties for

compliance. The Committee and the

management must sign their names at

year’s end to ensure that no transactions

with confl icts of interest occurred in the

past year. If there was any, it was done

in compliance with SET regulations.

Transactions between connected parties

and the Company is scrutinized by the

Offi ce of Internal Audit and External Audit

to ensure the Company’s compliance

with laws and related regulations.

Policy or trend for future connected transactions

Since transactions with connected

parties represent those conducted in

the course of normal business practice, it

is expected that connected transactions

will continue to take place in future.

Especially for the one related to joint

development of shopping complexes

with other companies in the Central

Group, it is the strong point that helps

promote CPN’s successful operation

and contributed to its market leadership

from past to present. The policy or

trend for future connected transactions

remains committed to the same principle

as the previous year, namely following

the condition of general trading and

taking into account the benefi t of the

Company and shareholders. CPN’s

Board has clearly approved the condition

of normal trading in the Company’s

and its subsidiaries’ transaction with

connected parties for transparent

business operation and the operational

guidance for related parties as follows:

1. Joint Shopping Complex Development

with Companies of the Central Group

*** It is an open principle that has been

practiced since the Company was

enlisted on SET in 1995***

To develop an integrated shopping

complex, i t is necessary to have

components enhancing the Company’s

strength. Companies in the Central

Group operate related businesses with

CPN, such as department store, retail

business, and hotels. With their long

experience in the industry and strong

brand, these companies can enhance

the project’s credibility, resulting in

stronger business operation as well as

Company’s and shareholders’ added

value. Below are the characteristics of

joint shopping complex development

with other companies in the Central

Group.

1.1 Land Purchase/Sale or Leasing/

For Rent

Principles: CPN and other companies

in the Central Group make a purchase

or leasing from outsiders for joint

shopping complex development.

The process is to have a company

buy or rent a whole plot of land

from the landlord. Once the project

design is completed, that company

sells or sub-leases the land to other

companies in proportion to each

company’s need to develop its own

project. (Each takes responsibility

for its own plot of land.)

Price and condition setting: Cost plus

cost of fund

1.2 Construction of Shopping

Complexes and Department Stores

or BUs

Principles: Each holds the ownership

of land on which its building is

situated. Each is therefore responsible

for its own construction cost.

Price and condition setting: Actual

c o s t w i t h t h e i n d e p e n d e n t

engineering consultant fair ly

calculating the construction cost and

system according to the proportion

of actual area use.


1.3 Construction of common areas,

comprising car parks and landscape

Principles:

> CPN holds the ownership of the

car park and the outer section of

shopping complexes. It also

takes responsibility for the costs

of all common areas, considered

part of the service provided to

tenants.

> Department s tores or BUs

jointly take responsibility for

construct ion according to

operational guidance as follows:

1) Car parks: At no less than half

of the construction costs pro-

vided by department stores

for customers as required by

law

2) Common areas: In proportion

to the gross area

Price and condition setting: Actual

cost – with the independent

engineering consultant fair ly

calculating the construction cost

and system according to the

proportion of actual area use.

1.4 Large Space Rental or Space for Rent

in Shopping Complexes

Principles: CPN may rent or rent out

large areas of department stores or

Bus, and the lease will be agreed at

the stage of project design.

Price and condition setting: Cost of

land and construction plus cost of

fund and operating expense

2. Space rental, service fee and utility fee

Principle: In charging short-term or

long-term rental, service fees or utility

fees from various retail businesses

under the Central Group or connected

parties that rent the retail space for

other purposes, the price will be set by

comparison with the one for profi table

clients. Rental rates are subject to

locations, area sizes, forms, rental

patterns, periods, and categories. The

benefits earned are not only rentals,

service fees, and utility fees, but also

the potential in business operation,

experience and success in joint

business from past to present.

Price and condition setting: Set a price

by comparing with the one for profi table

clients.

“Profitable customers” means clients

with high potential, who rent large retail

space or in many projects and provide

direct or indirect support for the

Company’s successful operation.

The Central Group conducts connected

businesses with various companies

and with potential connected transac-

tions. Since its establishment, the

Central Group has been potential business

alliance and it has provided great support

to CPN’s successful operation. As a result,

CPN remains the source of continually

connected transactions. For price and

condition deliberation, CPN still takes

its best interests into account.

3. Fee for Operating Expenses

“Operating Expenses” are insurance

premiums, property taxes, promotional

expenses, recognizance fees, and service

fee collected by tenants

Principles: Asset management incurs

operating expenses. In normal business

practice, the company charges these

expenses by calculating from the actual

operating cost. The rate, in the same

standard for general customers, depends

on lease categories and space rental

patterns.

Price and condition setting: Actual cost

4. Insurance/Group Health Insurance

Principles: Comprehensively and

equally provide relevant and necessary

information for the price off er to each

insurance broker. The committee

considers the selection of these brokers.

In the process, no connected committee

or connected management members

can attend the deliberation.

Price and condition setting: Market

price or compared price from the price

off ered by the insurance broker with the

most reasonable amount and the most

benefi cial conditions for the Company.

The price can be compared at least

two years backward. In case there is

no comparable offer, the Company

deliberates the approval by comparing

prices with those of the previous year,

depending on the insurance conditions

and market situation during that period.

5. Procurement - Employment

“Procurement” means the purchase

of materials, equipment or products,

including rental or hire purchase.

“Employment” means to hire a seller,

manufacturer, contractor or organizer

to produce, organize, manage, assemble

or construct from the beginning stage to

completion, including service provision,

inclusive service, and transportation.

This includes the package purchase or

hiring of a given contractor to construct

buildings and install equipment while

managing construction project as well.

Principles: Follow the Company’s

procurement regulations and process.

In selecting the seller or contractor,

CPN will proceed with transparency

and fairness according to the stated

procurement policy. In the process, no

connected committee or connected

management can attend the deliberation.

Price and condition setting: Market

price or compared price from the price

offering with the most reasonable

amount and the most beneficial

conditions for the Company.

CentralWorld

The Board of Directors of Central Pattana

Public Company Limited (“the Company”)

is responsible for the consolidated fi nancial

statement of the Company and its subsidiaries

as well as fi nancial information in the annual

report. The fi nancial statement is prepared

in accordance with generally accepted

accounting standards which are appropriately

applied on a consistent basis. Conservation

judgment and best estimate are adopted in

this preparation. In addition, all important

information is adequately disclosed in the

notes to fi nancial statement.

The Board of Directors has set up and

maintained an effective internal control

to reasonably ensure that all accounting

records are accurate, complete and suffi cient

to secure its assets. Moreover, all possible

weakness could be found to prevent fraud

or material unusual transactions.

The Board of Directors has appointed the audit

committee which comprises independent

directors, to control quality of fi nancial report

and internal control system. The opinion

of the audit committee on this matter has

already been presented in the audit committee

report. The Board of Directors is of an opinion

that internal control systems of the Company

are in the satisfactory and suffi cient level to

reasonably build the confidence in the

reliability of the consolidated financial

statement of the Company and its subsidiaries

as of 31 December 2011.

RESPONSIBILITY OF THE BOARD OF DIRECTORS TO FINANCIAL STATEMENT

(Mr. Suthichai Chirathivat)

Chairman

(Mr. Kobchai Chirathivat)

President & CEO

|150 CPN ANNUAL REPORT 2011151

AUDIT REPORT OF CERTIFIED PUBLIC ACCOUNTANT

To the Shareholders of Central Pattana Public

Company Limited

I have audited the accompanying consolidated

and separate statements of fi nancial position

as at 31 December 2011 and 2010, and the

related statements of comprehensive income,

changes in equity and cash fl ows for the years

then ended of Central Pattana Public Company

Limited and its subsidiaries, and of Central

Pattana Public Company Limited, respectively.

The Company’s management is responsible

for the correctness and completeness of the

information presented in these financial

statements. My responsibility is to express an

opinion on these fi nancial statements based

on my audits.

I conducted my audits in accordance with

generally accepted auditing standards. Those

standards require that I plan and perform the

audit to obtain reasonable assurance about

whether the fi nancial statements are free of

material misstatement. An audit includes

examining, on a test basis, evidence supporting

the amounts and disclosures in the fi nancial

statements. An audit also includes assessing

the accounting principles used and signifi cant

estimates made by management, as well as

evaluating the overall fi nancial statement

presentation. I believe that my audits provide

a reasonable basis for my opinion.

(Vichien Thamtrakul)

Certifi ed Public Accountant

Registration No. 3183

In my opinion, the consolidated and separate

fi nancial statements referred to above present

fairly, in all material respects, the fi nancial

positions as at 31 December 2011 and 2010

and the results of operations and cash fl ows

for the years then ended of Central Pattana

Public Company Limited and its subsidiaries,

and of Central Pattana Public Company

Limited, respectively, in accordance with

Financial Reporting Standards.

As explained in notes 2 and 3 to the fi nancial

statements, with eff ect from 1 January 2011

the Company has adopted certain new and

revised fi nancial reporting standards. The

consolidated and separate fi nancial statements

for the years ended 31 December 2010, have

been restated accordingly.

KPMG Phoomchai Audit Ltd.

Bangkok

24 February 2012

(Vi hi Th k l)

CENTRAL PATTANA PUBLIC COMPANY LIMITED

AND ITS SUBSIDIARIES

ANNUAL FINANCIAL STATEMENTS AND

NOTES TO THE FINANCIAL STATEMENTS

For the years ended 31 December 2011 and 2010


(in Baht)

Consolidated Separate fi nancial statements fi nancial statements

Note 2011 2010 2011 2010 (Restated) (Restated)

Assets

Current assets

Cash and cash equivalents 7 833,058,059 771,564,294 199,960,894 245,877,887

Current investments 8 111,556,736 860,706,639 3,070,000 753,182,692

Trade accounts receivable 6, 9 881,244,960 653,490,441 509,519,330 214,101,036

Other accounts receivable 6, 10 1,466,528,589 1,479,162,764 1,293,383,167 1,295,895,798

Short-term loans to related parties 6 - - 1,161,469,014 1,696,518,717

Total current assets 3,292,388,344 3,764,924,138 3,167,402,405 4,205,576,130

Non-current assets

Investments in subsidiaries and funds 5, 11 - - 21,680,083,928 19,676,870,795

Investment in associate 12 2,714,169,875 2,684,149,680 4,446,170,726 4,446,170,726

Long-term investments - related parties 13 - - - -

Other long-term investments 8 2,242,050 1,000,000 1,000,000 1,000,000

Long-term loans to related parties 6 - - 14,599,734,495 10,862,619,172

Investment properties 14 40,742,772,653 29,954,910,170 7,325,441,109 6,446,262,980

Property, plant and equipment 15 2,423,240,406 2,354,350,706 331,075,203 165,428,439

Leasehold rights 16 13,477,545,678 13,548,745,499 5,307,521,662 1,967,797,566

Asset usage rights 17 156,792,365 165,572,096 - -

Deferred tax assets 18 948,028,472 1,100,982,528 418,372,632 504,174,566

Other non-current assets 6, 19 301,985,134 294,766,235 161,244,049 163,970,629

Total non-current assets 60,766,776,633 50,104,476,914 54,270,643,804 44,234,294,873

Total assets 64,059,164,977 53,869,401,052 57,438,046,209 48,439,871,003

STATEMENTS OF FINANCIAL POSITIONCentral Pattana Public Company Limited and its Subsidiaries

As at 31 December 2011 and 2010

The accompanying notes are an integral part of these fi nancial statements.

(in Baht)



Liabilities and equity

Current liabilities

Trade accounts payable - related parties 6 6,212,319 5,988,668 110,962,195 32,179,130

Other accounts payable 6, 22 4,499,378,266 2,656,778,353 3,762,541,878 946,321,718

Short-term loans from related parties 6, 20 3,815,441 3,686,885 1,128,800,298 129,326,162

Current portion of long-term loans 20 6,479,917,200 2,989,927,200 5,600,040,000 2,050,050,000

Current portion of accounts payable

for leasehold rights 6 426,171,727 413,758,958 426,171,727 413,758,959

Other short-term loans payable 20 500,000,000 1,100,000,000 500,000,000 1,100,000,000

Current portion of unearned rental

and service income 292,122,572 311,656,114 113,908,826 120,268,750

Income tax payable 315,041,898 352,419,087 80,558,385 130,030,768

Contractor payables 2,832,830,633 2,319,078,941 575,354,279 59,191,268

Total current liabilities 15,355,490,056 10,153,294,206 12,298,337,588 4,981,126,755

Non-current liabilities

Long-term loans from related parties 6, 20 - - 3,349,684,726 3,409,457,729

Other long-term loans payable 20 18,264,764,200 14,994,681,400 13,649,910,000 11,749,950,000

Accounts payable for leasehold right 6 219,292,248 438,584,496 219,292,248 438,584,496

Deferred tax liabilities 18 1,030,884,865 1,686,869,229 649,008,161 1,050,445,468

Employee benefi t obligations 23 110,267,656 94,270,418 96,040,364 78,990,021

Unearned rental and service income 4,731,512,060 4,235,482,125 627,979,925 864,581,903

Deposits received from customers 3,890,619,901 3,340,313,554 1,105,965,774 1,169,881,011

Guarantees for leasehold rights 8,156,688 8,156,688 5,812,380 -

Total non-current liabilities 28,255,497,618 24,798,357,910 19,703,693,578 18,761,890,628

Total liabilities 43,610,987,674 34,951,652,116 32,002,031,166 23,743,017,383






(in Baht)



Equity

Share capital 24

Authorised share capital 2,178,816,000 2,178,816,000 2,178,816,000 2,178,816,000

Issued and paid-up share capital 2,178,816,000 2,178,816,000 2,178,816,000 2,178,816,000

Premium on ordinary shares 2,007,565,850 2,007,565,850 2,007,565,850 2,007,565,850

Retained earnings

Appropriated for legal reserve 25 217,881,600 217,881,600 217,881,600 217,881,600

Unappropriated 15,610,308,220 14,121,582,338 21,029,706,949 20,290,675,526

Other components of equity 25 (51,785,457) (51,119,281) 2,044,644 1,914,644

Equity attributable to owners of the Company 19,962,786,213 18,474,726,507 25,436,015,043 24,696,853,620

Non-controlling interests 485,391,090 443,022,429 - -

Total equity 3(a) 20,448,177,303 18,917,748,936 25,436,015,043 24,696,853,620

Total liabilities and equity 64,059,164,977 53,869,401,052 57,438,046,209 48,439,871,003



(in Baht)



Income

Revenue from rent and services 6 10,853,186,856 9,822,418,845 3,729,644,366 4,008,073,875

Revenue from food and beverage 6 632,055,887 550,031,151 - -

Revenue from hotel operation 465,487,450 157,451,438 - -

Investment income 6, 27 47,847,220 225,813,760 1,677,540,681 2,581,550,950

Other income 6, 28 1,001,987,143 1,116,863,333 721,453,283 822,498,311

Total income 13,000,564,556 11,872,578,527 6,128,638,330 7,412,123,136

Expenses

Cost of rent and services 6, 41 7,050,228,517 6,386,877,147 2,508,058,189 2,216,347,534

Cost of food and beverage 6 541,348,043 470,518,680 - -

Cost of hotel operation 191,869,660 67,079,971 - -

Administrative expenses 6, 30, 41 2,410,124,016 2,099,032,367 1,500,442,132 1,333,998,186

Losses from asset write-off 36 - 775,000,003 - -

Finance costs 6, 32 874,265,603 688,289,917 905,659,604 786,904,766

Total expenses 11,067,835,839 10,486,798,085 4,914,159,925 4,337,250,486

Share of profi t of associate 12 497,549,722 475,122,927 - -

Profi t before income tax expense from

continueing operations 2,430,278,439 1,860,903,369 1,214,478,405 3,074,872,650

Income tax (expense) credit 33 (354,479,196) (722,836,310) 69,256,843 (326,920,500)

Profi t for the year 2,075,799,243 1,138,067,059 1,283,735,248 2,747,952,150

Other comprehensive income

Foreign currency translation diff erences for

foreign operations (3,453,119) 1,636 - -

Net change in fair value of

available-for-sale investments 2,786,943 1,703,612 130,000 620,000

Other comprehensive income

for the year, net of income tax (666,176) 1,705,248 130,000 620,000

Total comprehensive income for the year 2,075,133,067 1,139,772,307 1,283,865,248 2,748,572,150

STATEMENTS OF COMPREHENSIVE INCOMECentral Pattana Public Company Limited and its Subsidiaries





(in Baht)



Profi t attributable to:

Owners of the Company 2,058,123,354 1,124,865,906 1,283,735,248 2,747,952,150



Total comprehensive income attributable to:

Owners of the Company 2,057,457,178 1,126,571,154 1,283,865,248 2,748,572,150


Total comprehensive income for the year 2,075,133,067 1,139,772,307 1,283,865,248 2,748,572,150

Basic earnings per share 34 0.94 0.52 0.59 1.26

STATEMENTS OF COMPREHENSIVE INCOMECentral Pattana Public Company Limited and its Subsidiaries


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(in Baht)


2011 2010 2011 2010 (Restated) (Restated)

Cash fl ows from operating activities


Adjustments for

Depreciation 1,851,162,515 2,019,660,139 400,398,512 384,143,760

Amortisation of leasehold 1,096,771,914 336,578,890 174,242,179 126,918,982

Losses from write-off of assets - 775,000,003 - -

Reversal of allowance for impairment of assets (187,015,215) - (91,225,654) -

Dividend income (110,000) (90,000) (999,483,569) (1,816,330,446)

Interest income (47,737,220) (225,723,760) (678,057,112) (765,220,504)

Finance costs 874,265,603 688,289,917 905,659,604 786,904,766

Allowance for doubtful accounts (reversal) 6,377,921 56,337 631,919 (1,251,966)

Reversal of allowance for doubtful

accounts-long-term loans - (162,739,322) - (162,739,322)

Reversal of provision for guarantee payment - (16,227,793) - (16,227,793)

(Gain) loss on disposal of equipment 461,571 (1,213,944) (3,645,234) 5,733,415

Recognition of unearned rental and service income (547,810,134) (328,662,622) (125,554,967) (123,860,101)

Employee benefi t obligations 16,688,045 15,404,770 17,635,450 12,784,450

Share of profi t of associated (497,549,722) (475,122,927) - -

Unrealised loss on exchange 32,769,960 - - -

Unrealised (gain) loss from fi nancial instrument (22,151,209) - 8,236,569 -

Income tax expense 354,479,196 722,836,310 (69,256,843) 326,920,501

5,006,402,468 4,486,113,057 823,316,102 1,505,727,892

STATEMENTS OF CASH FLOWSCentral Pattana Public Company Limited and its Subsidiaries



(in Baht)



Changes in operating assets and liabilities

Trade accounts receivable (234,132,441) (172,612,005) (296,050,212) (19,520,574)

Other accounts receivable 44,878,213 (572,621,458) (6,085,199) 209,801,403

Other non-current assets 6,271,633 173,006,102 7,437,380 141,544,248

Trade accounts payable 223,651 (947,712) 78,783,065 21,802,487

Other accounts payable 2,253,534,595 406,227,022 3,136,106,588 236,018,863

Payment from provision for guarantee payment - (14,737,207) - (14,737,207)

Unearned rental and service income 1,024,306,527 131,441,529 (117,406,935) 81,301,059

Deposits from customers received 1,651,675,375 842,480,424 664,626,504 279,003,360

Repayment of deposits received from customers (1,101,369,028) (496,837,236) (728,541,742) (176,794,826)

Guarantee for leasehold rights - (14,962,759) 5,812,380 -

Employee benefi ts paid (690,807) (7,639,833) (585,107) (7,209,409)

Cash generated from operating activities 8,651,100,186 4,758,909,924 3,567,412,824 2,256,937,296

Income tax paid (894,886,693) (828,455,284) (295,850,913) (329,935,344)

Net cash provided by operating activities 7,756,213,493 3,930,454,640 3,271,561,911 1,927,001,952

Cash fl ows from investing activities

Interest received 41,170,161 131,474,006 760,751,513 812,383,091

Dividends received 467,639,528 408,842,911 1,009,799,422 1,792,914,421

(Increase) decrease in current investments 751,936,845 (51,649,871) 750,242,692 (151,292,106)

Issuance of ordinary shares - 12,391,778 - -

Purchase of equity securities and investment units (1,242,050) - (2,031,197,133) (2,023,665,378)

Proceeds from redemption of investment units in funds - - 27,984,000 27,984,000

Loans to related parties - - (11,926,786,658) (6,604,360,711)

Loans repaid by related parties - 162,739,322 8,635,597,814 5,952,868,079

Purchase of property, plant and equipment (10,544,228,997) (4,908,541,818) (794,889,176) (760,453,220)

Leasehold rights (1,927,015,144) (775,590) (3,856,666,009) (26,254,070)

Sales of equipment 583,282,899 102,082,316 15,790,690 4,953,344

Decrease in contractor payables (1,601,627,544) (879,389,074) (54,605,336) (95,450,003)

Decrease in leasehold rights payables (206,879,479) (390,338,640) (206,879,479) (390,338,640)

Net cash used in investing activities (12,436,963,781) (5,413,164,660) (7,670,857,660) (1,460,711,193)





(in Baht)



Cash fl ows from fi nancing activities

Finance costs paid (869,495,190) (690,847,876) (889,851,486) (814,362,817)

Proceeds from loans from related parties - 63,762,896 2,067,184,668 2,873,620,080

Proceeds from borrowings 27,850,000,000 5,700,000,000 25,200,000,000 3,300,000,000

Repayment of loans from related parties - (191,800) (1,129,024,863) (3,102,495,453)

Repayments of borrowings (21,689,927,200) (3,284,837,200) (20,350,050,000) (2,100,000,000)

Payment for liability under fi nancial lease (269,747) (1,179,641) (269,747) (1,179,641)

Dividends paid (544,610,691) (1,266,988,384) (544,609,816) (1,263,545,740)

Net cash provided by (used in) fi nancing activities 4,745,697,172 519,717,995 4,353,378,756 (1,107,963,571)

Foreign currency translation diff erences for foreign operations (3,453,119) 1,636 - -

Net increase (decrease) in cash and cash equivalents 61,493,765 (962,990,389) (45,916,993) (641,672,812)

Cash and cash equivalents at 1 January 771,564,294 1,734,554,683 245,877,887 887,550,699

Cash and cash equivalents at 31 December 833,058,059 771,564,294 199,960,894 245,877,887



Non-cash transactions

The Company has unpaid liabilities for construction of property under development as at 31 December 2011

amounting to approximately Baht 569.8 million (2010: Baht 36.1 million)

The Group has unpaid liabilities for construction of property under development as at 31 December 2011

amounting to approximately Baht 2,126.1 million (2010: Baht 1,720.9 million)

NOTES TO THE FINANCIAL STATEMENTSCentral Pattana Public Company Limited and its Subsidiaries


Note Contents

1 General information

2 Basis of preparation of the fi nancial statements

3 Changes in accounting policies

4 Signifi cant accounting policies

5 Acquisitions of subsidiaries and non-controlling interests

6 Related parties

7 Cash and cash equivalents

8 Other investments

9 Trade accounts receivable

10 Other accounts receivable

11 Investments in subsidiaries and funds

12 Investment in associate

13 Long-term investments - related parties

14 Investment properties

15 Property, plant and equipment

16 Leasehold rights

17 Assets usage right

18 Deferred tax

19 Other non-current assets

20 Interest-bearing liabilities

21 Provision for guarantee payment

22 Other account payable

Note Contents

23 Employee benefi t obligations

24 Share capital

25 Reserves

26 Segment reporting

27 Investment income

28 Other income

29 Expenses by nature

30 Administrative expenses

31 Employee benefi t expenses

32 Finance costs

33 Income tax expense

34 Basic earnings per share

35 Dividends

36 Impact from fi re damage as a result of political demonstration

37 Leasing or sub-leasing properties

38 Financial instruments

39 Commitments with non-related parties

40 Contingent liabilities

41 Impact of severe fl ooding in Thailand

42 Events after the reporting period

43 Thai Financial Reporting Standards (TFRS) not yet adopted

44 Reclassifi cation of accounts


These notes form an integral part of the

fi nancial statements.

The financial statements issued for Thai

statutory and regulatory reporting purposes are

prepared in the Thai language. These English

language financial statements have been

prepared from the Thai language statutory

fi nancial statements, and were approved and

authorised for issue by the Board of Directors

on 24 February 2012.

1 General information

Central Pattana Public Company Limited, the

“Company”, is incorporated in Thailand and

has its registered offi ce at 999/9 Rama I Road,

Patumwan, Patumwan, Bangkok 10330.

The Company was listed on the Stock

Exchange of Thailand in March 1995.

The Company’s major shareholder during

the financial year was Central Holdings

Company Limited (27% shareholding), which

is incorporated in Thailand.

The principal businesses of the Company

are to invest in developing new projects,

manage projects and earn income from

property management. Details of the

Company’s subsidiaries and funds as at 31

December 2011 and 2010 were as follows:

Type of Country of Ownership interest (%)

Name of entity business incorporation 2011 2010

Direct subsidiaries

Central Pattana Rama 2 Co., Ltd. (1) Thailand 100.0 100.0

Central Pattana Chiangmai Co., Ltd. (1) (2) (4) Thailand 100.0 100.0

Langsuan Realty Co., Ltd. (3) Thailand 100.0 100.0

Central Pattana Rattanathibet Co., Ltd. (1) (2) (4) Thailand 100.0 100.0

Central Realty Service Co., Ltd. (2) Thailand 100.0 100.0

Central Food Avenue Co., Ltd. (4) Thailand 100.0 100.0

Central World Co., Ltd. (1) (2) (4) (7) Thailand 100.0 100.0

Central Pattana Rama 3 Co., Ltd. (1) Thailand 100.0 100.0

CPN Pattaya Beach Co., Ltd. (1) (2) (4) Thailand 100.0 100.0

Central Pattana Chonburi Co., Ltd. (1) (2) (4) Thailand 100.0 100.0

CPN Pattaya Beach Hotel Co., Ltd. (7) Thailand 100.0 100.0

CPN Construction Management Co.,Ltd. (1) Thailand 100.0 100.0

CPN Chiangrai Co.,Ltd. (1) (2) (4) Thailand 100.0 100.0

CPN Global Company Limited (6) Thailand 100.0 -

Central Realty Service Rama 3 Co., Ltd.

(undergoing liquidation process) (2) Thailand 100.0 -

Central Pattana Nine Square Co., Ltd. (1) (2) Thailand 93.3 87.1

Central Pattana Khon Kaen Co., Ltd. (1) (2) (4) Thailand 78.1 78.1

Type of Country of Ownership interest (%)

Name of entity business incorporation 2011 2010

Indirect subsidiaries

Central Play Land Co., Ltd. (1) (5) Thailand 100.0 100.0

Bangna Central Property Co., Ltd. (1) to (5) Thailand 99.9 99.9

Central Realty Service Rama 3 Co., Ltd. (2) Thailand - 100.0

Global Retail Development & Investment Limited (6) Hong Kong 100.0 -

Global Commercial Property Limited (6) Hong Kong 100.0 -

Central (Shanghai) Management

Consulting Co.,Ltd. (8) China 100.0 -

CPN Complex Co.,Ltd. (1) (2) Thailand 99.9 -

CPN City Co.,Ltd. (6) Thailand 99.9 -

Funds

The Thai Business Fund 4 (6) Thailand 100.0 100.0

The Thai Business Fund 5 (6) Thailand 100.0 100.0

Type of business

1. Construction of office buildings and

shopping centers for rent

2. Provision of utilities in shopping centers

3. Construction of condominiums and shop

houses for rent

4. Sales of food and beverage

5. Operator of play land and water theme

park on shopping centers

6. Investment in real estates

7. Hotel business

8. Real estate management consulting and

corporate services

2 Basis of preparation of the

fi nancial statements

(a) Statement of compliance

The financial statements are prepared in

accordance with Thai Financial Reporting

Standards (TFRS) and guidelines promulgated

by the Federation of Accounting Professions

(“FAP”), applicable rules and regulations of the

Thai Securities and Exchange Commission.

During 2010 and 2011, the FAP issued the

following new and revised TFRS relevant

to the Group’s operations and eff ective for

accounting periods beginning on or after

1 January 2011:


TFRS Topic

TAS 1 (revised 2009) Presentation of Financial Statements

TAS 7 (revised 2009) Statement of Cash Flows

TAS 8 (revised 2009) Accounting Policies, Changes in Accounting Estimates and Errors

TAS 10 (revised 2009) Events after the Reporting Period

TAS 16 (revised 2009) Property, Plant and Equipment

TAS 17 (revised 2009) Leases

TAS 18 (revised 2009) Revenue

TAS 19 Employee Benefi ts

TAS 23 (revised 2009) Borrowing Costs

TAS 24 (revised 2009) Related Party Disclosures

TAS 26 Accounting and Reporting by Retirement Benefi t Plans

TAS 27 (revised 2009) Consolidated and Separate Financial Statements

TAS 28 (revised 2009) Investments in Associates

TAS 31 (revised 2009) Interests in Joint Ventures

TAS 33 (revised 2009) Earnings per Share

TAS 34 (revised 2009) Interim Financial Reporting

TAS 36 (revised 2009) Impairment of Assets

TAS 37 (revised 2009) Provisions, Contingent Liabilities and Contingent Assets

TAS 38 (revised 2009) Intangible Assets

TAS 40 (revised 2009) Investment Property

TFRS 2 Share-based Payment

TFRS 3 (revised 2009) Business Combinations

TFRS 5 (revised 2009) Non-current Assets Held for Sale and Discontinued Operations

FAP’s announcement no.17/2554 Transitional Procedures for Other Long-term Employee Benefi ts

FAP’s announcement no.18/2554 Accounting Guidance on Revaluation of Assets

The adoption of these new and revised

TFRS has resulted in changes in the Group’s

accounting policies. The effects of these

changes are disclosed in note 3.

In addition to the above new and revised

TFRS, the FAP has issued during 2010 a number

of other new and revised TFRS which are

expected to be effective for financial

statements beginning on or after 1 January

2013 and have not been adopted in the

preparation of these fi nancial statements.

These new and revised TFRS are disclosed

in note 43.

(b) Basis of measurement

The fi nancial statements have been prepared

on the historical cost basis except for the

following material items in the statements

of fi nancial position:

> derivative financial instruments are

measured at fair value;

> available-for-sale financial assets are

measured at fair value

(c) Presentation currency

The fi nancial statements are prepared and

presented in Thai Baht. All financial

information presented in Thai Baht has

been rounded in the notes to the fi nancial

statements to the nearest thousand unless

otherwise stated.

(d) Use of estimates and judgements

The preparation of fi nancial statements in

conformity with TFRS requires management

to make judgements, estimates and

assumptions that aff ect the application of

policies and reported amounts of assets,

liabilities, income and expenses. Actual

results may diff er from estimates.

Estimates and underlying assumptions are

reviewed on an ongoing basis. Revisions to

accounting estimates are recognised in the

period in which estimates are revised and in

any future periods aff ected.

Information about significant areas of

estimation uncertainty and cri t ical

judgements in applying accounting policies

that have the most significant effect on

the amount recognised in the financial

statements is included in the following notes:

Note 4(t) Current and deferred taxation

Note 14 Valuation of investment properties

Note 16 Leasehold rights

Note 18 Utilisation of tax losses

Note 21 Provision for guarantee payment

Note 23 Measurement of defi ned benefi t obligations

Note 38 Valuation of fi nancial instruments

Note 39 Commitments with non-related parties

Note 40 Contingent liabilities

Note 41 Impact of severe fl ooding in Thailand


3 Changes in accounting policies

(a) Overview

From 1 January 2011, consequent to the

adoption of new and revised TFRS as set

out in note 2, the Group has changed its

accounting policies in the following areas:

> Presentation of fi nancial statements

> Accounting for property, plant and equipment

> Accounting for investment properties

> Accounting for borrowing costs

> Accounting for employee benefi ts

Details of the new accounting policies

adopted by the Group and the impact of

the changes on the fi nancial statements are

included in notes 3b to 3h below. Other new

and revised TFRS did not have any impact

on the accounting policies, fi nancial position

or performance of the Group. The impact of

the changes on the fi nancial statements for

the years ended 31 December 2011 and 2010

is summarised as follows:

For the year ended 31 December 2010

(in thousand Baht)


Note 2010 2010

Statement of fi nancial position

Equity at 1 January 2010 – as reported 19,008,102 23,263,323

Changes as a result of the adoption retrospectively

of TAS 19 Employee Benefi ts 23 (86,504) (73,415)

Increase of deferred tax assets 24,927 22,025

Equity at 1 January 2010 - restated 18,946,525 23,211,933

Equity at 31 December 2010 – as reported 18,984,960 24,752,147

Changes as a result of the adoption retrospectively

of TAS 19 Employee Benefi ts 3(h) (94,270) (78,990)

Increase of deferred tax assets 3(h) 27,059 23,697

Equity at 31 December 2010 - restated 18,917,749 24,696,854


(in thousand Baht)


Note 2010 2010

Statement of comprehensive income for the

year ended 31 December 2010

Profi t before income tax – as reported 1,868,669 3,080,448

Changes before tax as a result of the adoption

retrospectively of TAS 19 Employee Benefi ts 3(h) (7,766) (5,575)

Profi t before income tax - restated 1,860,903 3,074,873

Income tax expense – as reported 724,968 328,593

Changes to income tax expense as a result of the

adoption retrospectively of TAS 19 Employee Benefi ts 3(h) (2,132) (1,672)

Income tax expense - restated 722,836 326,921

Profi t - restated 1,138,067 2,747,952

Decrease in basic earnings per share (in Baht) - -


(in thousand Baht)


Note 2011 2011

Statement of comprehensive income for the

year ended 31 December 2011

Decrease in profi t before income tax as a result

of the adoption of TAS 19 Employee Benefi ts 3(h) (15,997) (17,050)

Decreased in profi t before income tax (15,997) (17,050)

Decrease in income tax expenses as a result

of the adoption of TAS 19 Employee Benefi ts 3(h) 5,265 4,489

Decreased in profi t (10,732) (12,561)

Decrease in basic earnings per share (in Baht) - -


(b) Presentation of fi nancial statements

From 1 January 2011, the Group has adopted

TAS 1 Presentation of Financial Statements

(Revised 2009). Under the revised standard, a

set of fi nancial statements comprises:

> Statement of fi nancial position;

> Statement of comprehensive income;

> Statement of changes in equity;

> Statement of cash fl ows; and

> Notes to the fi nancial statements.

As a result, the Group presents all owner

changes in equity in the statement of changes

in equity and all non-owner changes in equity

in the statement of comprehensive income.

Previously, all such changes were included in

the statement of changes in equity.

Comparative information has been re-

presented so that it also is in conformity with

the revised standard. Since the change in

accounting policy only impacts presentation

aspects, there is no impact on reported profi t

or earnings per share.

(c) Accounting for business combinations


TFRS 3 Business Combinations (revised

2009) and TAS 27 Consolidated and Separate

Financial Statements (revised 2009) for all

business combinations on or after 1 January

2011. The new policy for accounting for

business combinations, together with

information on the previous policy, is given

below. The new policy has been applied

prospectively from 1 January 2011 in

accordance with the transitional provisions

of the revised standards.

Business combinations are accounted for

using the acquisition method as at the

acquisition date, which is the date on which

control is transferred to the Group. Control

is the power to govern the financial and

operating policies of an entity so as to obtain

benefits from its activities. In assessing

control, the Group takes into consideration

potential voting rights that are currently

exercisable.

Acquisitions on or after 1 January 2011

For acquisitions on or after 1 January 2011, the

Group measures goodwill at the acquisition

date as:

> the fair value of the consideration

transferred; plus

> the recognised amount of any non-

controlling interests in the acquiree; plus

> if the business combination is achieved in

stages, the fair value of the existing equity

interest in the acquiree; less

> the net recognised amount (generally fair

value) of the identifi able assets acquired and

liabilities assumed.

When the excess is negative, a bargain

purchase gain is recognised immediately

in profi t or loss.

The consideration transferred does not

include amounts related to the settlement

of pre-existing relationships. Such amounts

are generally recognised in profi t or loss.

Costs related to the acquisition, other than

those associated with the issue of debt or

equity securities, that the Group incurs in

connection with a business combination

are expensed as incurred.

Any contingent consideration payable is

recognised at fair value at the acquisition

date. If the contingent consideration is

classifi ed as equity, it is not remeasured and

settlement is accounted for within equity.

Otherwise, subsequent changes to the fair

value of the contingent consideration are

recognised in profi t or loss.

Acquisitions between 1 January 2008 and

31 December 2010

For acquisitions between 1 January 2008 and

31 December 2010, goodwill represented the

excess of the cost of the acquisition over the

Group’s interest in the recognised amount

(generally fair value) of the identifi able assets,

liabilities and contingent liabilities of the

acquiree. When the excess was negative,

a bargain purchase gain was recognised

immediately in profi t or loss.

Transaction costs, other than those associated

with the issue of debt or securities, that the

Group incurred in connection with business

combinations were capitalised as part of the

cost of the acquisition.

Acquisitions prior to 1 January 2008

For acquisitions prior to 1 January 2008,

goodwill was measured in the same way

as described in the preceding paragraph.

However, both positive and negative goodwill

were amortised over their estimated useful

life of 20 years. On 1 January 2008, on adoption

of the former TAS 43 (revised 2007), the Group

discontinued amortising goodwill. Negative

goodwill carried in the fi nancial statements

as at 31 December 2007 was derecognised by

crediting unappropriated retained earnings

on 1 January 2008.

(d) Accounting for acquisitions of

non-controlling interests (previously

termed ‘minority interests’)


TAS 27 Consolidated and Separate Financial

Statements (revised 2009) for all acquisitions

of non-controlling interests in subsidiaries.

The new policy for accounting for acquisitions

of non-controlling interests, together with

information on the previous policy, is given

below. The new policy has been applied

prospectively from 1 January 2011 in

accordance with the transitional provisions

of the revised standard. The Group acquisitions

of non-controlling interests during 2011 and

the eff ect of the these change is disclosed

in note 5.

Under the new accounting policy, acquisitions

of non-controlling interests are accounted

for as transactions with owners in their

capacity as owners and therefore no goodwill

is recognised as a result of such transactions.

The adjustments to non-controlling interests

are based on a proportionate amount of the

net assets of the subsidiary.

Previously, goodwill was recognised on the

acquisition of non-controlling interests in a

subsidiary, which represented the excess of

the cost of the additional investment over

the carrying amount of the interest in the net

assets acquired at the date of the transaction.

(e) Accounting for property, plant and

equipment


TAS 16 (revised 2009) Property, Plant and

Equipment in determining and accounting

for the cost and depreciable amount of

property and equipment.

The principal changes introduced by the

revised TAS 16 and aff ecting the Group are

that: (i) costs of asset dismantlement, removal

and restoration have to be included as asset

costs and subject to annual depreciation;

(ii) the depreciation charge has to be determined

separately for each significant part of an

asset; and (iii) in determining the depreciable

amount, the residual value of an item of

property, plant and equipment has to

be measured at the amount estimated

receivable currently for the asset if the asset

were already of the age and in the condition

expected at the end of its useful life.

Furthermore, the residual value and useful

life of an asset have to be reviewed at least at

each fi nancial year-end.

The changes have been applied pro-

spectively in accordance with the transitional

provisions of the revised standard, except

that consideration of the costs of asset

dismantlement, removal and restoration,

have been applied retrospectively. The

change has had no material impact on the

profi t or earnings per share for the year ended

31 December 2011 and 2010.

(f) Accounting for investment properties


TAS 40 (revised 2009) Investment Property.

Under the revised standard, investment

property, defi ned as property owned to earn

rentals; capital appreciation; or both, is

disclosed in the financial statements

separately from other property, plant and

equipment and measured using either the

cost model or the fair value model, with

changes in fair value being recognised in

profi t or loss.

Previously, investment properties were

included in property, plant and equipment,

and leasehold rights and measured using

the cost model.

The Group has selected the cost model for

accounting for its investment properties

under the revised standard. The change

in accounting policy has been applied

retrospectively and the fi nancial statements

for the year ended 31 December 2010, which

are included in the Group’s 2011 fi nancial

statements for comparative purposes, have

been adjusted to reclassify investment

properties from ‘Property, plant and

equipment’ and ‘Leasehold Rights’ to a

separate account, ‘Investment property’.

The cost and accumulated depreciation as

at 1 January 2010 and 31 December 2010 of


the Group’s investment property previously

included in Property, plant and equipment,

and leasehold rights have been reclassifi ed

to a separate account, ‘Investment property’.

Apart from this reclassifi cation, the change

in policy has no material impact on the 2010

fi nancial statements.

From 1 January 2011, the depreciable amount

and useful life of the investment property

have been reassessed in accordance with

the requirements of TAS 16 (Revised 2009) –

see note 3(e). The change in accounting

policy in this regard has been applied

prospectively in accordance with the

transitional provisions of TAS 16 (Revised

2009), except that consideration of the costs

of asset dismantlement, removal and

restoration, have been applied retrospectively.

The change has had no material impact on

the profi t or earnings per share for year ended

31 December 2011 and 2010.

(in thousand Baht)


2011 2010 2011 2010

Statement of fi nancial position as at 31 December

Increase in investment property 40,742,773 29,954,910 7,325,441 6,446,263

Decrease in property, plant and equipments (49,955,825) (39,813,061) (11,204,108) (6,728,257)

Increase in leasehold rights 9,213,052 9,858,151 3,878,667 281,994

Increased (decreased) in retained earnings - - - -

(g) Accounting for borrowing costs


TAS 23 (revised 2009) Borrowing Costs.

Under the revised standard, borrowing

costs directly attributable to the acquisition,

construction or production of a qualifying

asset are capitalised as part of the cost of that

asset. Under the former standard, there was

also an option to expense borrowing costs on

qualifying assets when incurred.

It was the Group’s policy under the former

TAS 23 to capitalise borrowing costs directly

attributable to the acquisition, construction or

production of a qualifying asset Consequently

the adoption of the revised standard has

had no impact on reported profi t or earnings

per share.

(h) Accounting for employee benefi ts


TAS 19 Employee Benefits. Under the

new policy, the Group’s liability for post-

employment benefi ts is recognised in the

fi nancial statements based on calculations

performed by a qualifi ed actuary using the

projected unit credit method. Previously, this

liability was recognised as and when payments

were made.

The change in accounting policy has been

applied retrospectively and the Group’s 2010

financial statements, which are included

in the Group’s 2011 fi nancial statements for

comparative purposes have been restated

accordingly. The impact on the 2011 and

2010 fi nancial statements was as follows:

(in thousand Baht)


2011 2010 2011 2010

Statement of fi nancial position as at 31 December

Increase in employee benefi t obligations (110,267) (94,270) (96,040) (78,990)

Increase in deferred tax asset 21,794 27,059 19,208 23,697

Decrease in retained earnings (88,473) (67,211) (76,832) (55,293)

Statement of comprehensive income

for the year ended 31 December

Increase in employee expenses resulting in:

Increase in cost of rental and service (3,410) (3,282) (4,326) (1,415)

Increase in cost of food and beverage (160) (148) - -

Increase in administrative expenses (12,427) (4,336) (12,724) (4,160)

Decrease in profi t before income tax (15,997) (7,766) (17,050) (5,575)

Decrease in deferred tax expense 5,265 2,132 4,489 1,672

Decrease in profi t (10,732) (5,634) (12,561) (3,903)

Decrease in basic earnings per share (in Baht) - - - -

4 Signifi cant accounting policies

The accounting policies set out below have

been applied consistently to all periods

presented in these financial statements

except as explained in note 3, which

addresses changes in accounting policies.

(a) Basis of consolidation

The consolidated fi nancial statements relate

to the Company and its subsidiaries (together

referred to as the “Group”) and the Group’s

interests in associate.

Business combinations

The accounting policy for business

combinations has been changed from 1

January 2011. See note 3(c) for details.

The Group applies the acquisition method

for all business combinations other than

those with entities under common control.

Control is the power to govern the fi nancial

and operating policies of an entity so as to

obtain benefi ts from its activities. In assessing

control, the Group/Company takes into

consideration potential voting rights that

currently are exercisable. The acquisition date

is the date on which control is transferred

to the acquirer. Judgment is applied in

determining the acquisition date and

determining whether control is transferred

from one party to another.

Goodwill is measured as the fair value of

the consideration transferred including the

recognised amount of any non-controlling

interest in the acquiree, less the net recognised

amount (generally fair value) of the identifi able

assets acquired and liabilities assumed, all

measured as of the acquisition date.

Consideration transferred includes the fair

values of the assets transferred, liabilities

incurred by the Group to the previous owners

of the acquiree, and equity interests issued

by the Group. Consideration transferred also

includes the fair value of any contingent


consideration and share-based payment

awards of the acquiree that are replaced

mandatorily in the business combination.

If a business combination results in the

termination of pre-existing relationships

between the Group and the acquiree, then

the lower of the termination amount, as

contained in the agreement, and the value

of the off -market element is deducted from

the consideration transferred and recognised

in other expenses.

A contingent liability of the acquiree is

assumed in a business combination only if

such a liability represents a present obligation

and arises from a past event, and its fair

value can be measured reliably.

The Group measures any non-controlling

interest at its proportionate interest in the

identifi able net assets of the acquiree.

Transaction costs that the Group incurs in

connection with a business combination,

such as legal fees, and other professional and

consulting fees are expensed as incurred.

Acquisitions from entities under common

control

Business combinations of entities or

businesses under common control are

accounted for using a method similar to

the pooling of interest method and in

accordance with the Guideline issued in

2009 by the FAP.

Subsidiaries

Subsidiaries are entities controlled by the

Group. Control exists when the Group has

the power, directly or indirectly, to govern the

fi nancial and operating policies of an entity

so as to obtain benefi ts from its activities.

The fi nancial statements of subsidiaries are

included in the consolidated financial

statements from the date that control

commences until the date that control ceases.

The accounting policies of subsidiaries

have been changed where necessary to

align them with the policies adopted by the

Group. Losses applicable to non-controlling

interests in a subsidiary are allocated to

non-controlling interests even if doing so

causes the non-controlling interests to have

a defi cit balance.

Associates

Associates are those entities in which the

Group has significant influence, but not

control, over the financial and operating

policies. Signifi cant infl uence is presumed

to exist when the Group holds between 20%

and 50% of the voting power of another entity.

Investments in associates are accounted

for in the consolidated fi nancial statements

using the equity method (equity-accounted

investees) and are recognised initially at

cost. The cost of the investment includes

transaction costs.

The consolidated financial statements

include the Group’s share of profi t or loss

and other comprehensive income, after

adjustments to align the accounting policies

with those of the Group, from the date that

signifi cant infl uence commences until the

date that signifi cant infl uence ceases. When

the Group’s share of losses exceeds its interest

in an associate, the Group’s carrying amount

is reduced to nil and recognition of further

losses is discontinued except to the extent that

the Group has incurred legal or constructive

obligations or made payments on behalf of

the associate.

Transactions eliminated on consolidation

Intra-group balances and transaction, and

any unrealised income or expenses arising

from intra-group transactions, are eliminated

in preparing the consolidated financial

statements. Unrealised gains arising from

transactions with associates are eliminated

against the investment to the extent of the

Group’s interest in the investee. Unrealised

losses are eliminated in the same way as

unrealised gains, but only to the extent that

there is no evidence of impairment.

(b) Foreign currencies

Foreign currency transactions

Transactions in foreign currencies are

translated to Thai Baht at the foreign

exchange rates ruling at the dates of the

transactions.

Monetary assets and liabilities denominated

in foreign currencies at reporting date are

translated to Thai Baht at the foreign

exchange rates ruling at that date. Foreign

exchange diff erences arising on translation

are recognised in profi t or loss.

Non-monetary assets and liabilities measured

at cost in foreign currencies are translated to

Thai Baht using the foreign exchange rates

ruling at the dates of the transactions.

Foreign entities

The assets and liabilities of foreign entities

are translated to Thai Baht at the foreign

exchange rates ruling at the reporting date.

Goodwill and fair value adjustments arising

on the acquisition of foreign entities are stated

at exchange rates ruling on transaction dates.

The revenues and expenses of foreign

entities are translated to Thai Baht at rates

approximating the foreign exchange rates

ruling at the dates of the transactions.

Foreign exchange differences arising on

translation are recognised in other

comprehensive income and presented in

the foreign currency translation reserve in

equity until disposal of the investments.

When the settlement of a monetary item

receivable from or payable to a foreign

operation is neither planned nor likely in the

foreseeable future, foreign exchange gains

and losses arising from such a monetary

item are considered to form part of a net

investment in a foreign operation and are

recognised in other comprehensive income,

and presented in the foreign currency

translation reserve in equity until disposal of

the investment.

(c) Derivative fi nancial instruments

Derivative fi nancial instruments are used

to manage exposure to foreign exchange,

interest rate arising from operational, fi nancing

and investment activities. Derivative fi nancial

instruments are not used for trading purposes.

However, derivatives that do not qualify for

hedge accounting are accounted for as

trading instruments.

Derivatives are recognised initially at fair

value; attributable transaction costs are

recognised in profi t or loss when incurred.

Subsequent to initial recognition, they are

remeasured at fair value. The gain or loss on

remeasurement to fair value is recognised


The fair value of interest rate swaps is based

on broker quotes at the reporting date. Those

quotes are tested for reasonableness by

discounting estimated future cash flows

based on the terms and maturity of each

contract and using market interest rates for

a similar instrument at the reporting date.

The fair value of forward exchange contracts

is based on their listed market price, if

available. If a listed market price is not

available, then fair value is estimated by

discounting the difference between the

contractual forward price and the current

forward price at the reporting date for the

residual maturity of the contract using a

risk-free interest rate (based on government

bonds).

(d) Cash and cash equivalents

Cash and cash equivalents comprise cash

balances, call deposits and highly liquid

short-term investments. Bank overdrafts

that are repayable on demand are a

component of fi nancing activities for the

purpose of the statement of cash fl ows.

(e) Trade and other accounts receivable

Trade and other accounts receivable

(including balances with related parties) are

stated at their invoice value less allowance

for doubtful accounts.

The allowance for doubtful accounts is

assessed primarily on analysis of payment

histories and future expectations of customer

payments. Bad debts are written off when

incurred.

(f) Investments

Investments in subsidiaries and associate

Investments in subsidiaries and associate

in the separate fi nancial statements of the

Company are accounted for using the cost

method. Investment in associate in the

consolidated financial statements is

accounted for using the equity method.

Investments in other debt and equity

securities

Debt securities and marketable equity

securities held for trading are classifi ed as

current assets and are stated at fair value,

with any resultant gain or loss recognised in

profi t or loss.

Debt securities that the Group has positive

intent and ability to hold to maturity are

classifi ed as held-to-maturity investment.

Held-to-maturity investments are stated at

amortised cost, less any impairment losses.

The diff erence between the acquisition cost

and redemption value of such debt securities


is amortised using the eff ective interest rate

method over the period to maturity.

Debt securities and marketable equity

securities, other than those securities held

for trading or intended to be held to

maturity, are classifi ed as available-for-sale

investments. Available-for-sale investments

are, subsequent to initial recognition, stated

at fair value, and changes therein, other than

impairment losses and foreign currency

diff erences on available-for-sale monetary

items, are recognised directly in equity.

Impairment losses and foreign exchange

diff erences are recognised in profi t or loss.

When these investments are derecognised,

the cumulative gain or loss previously

recognised directly in equity is recognised

in the statement of income. Where these

investments are interest-bearing, interest

calculated using the eff ective interest method

is recognised in profi t or loss.

Equity securities which are not marketable

are stated at cost less any impairment losses.

The fair value of financial instruments

classifi ed as held-for-trading and available-

for-sale are determined at the quoted bid

price at the reporting date.

Disposal of investments

On disposal of an investment, the diff erence

between net disposal proceeds and the

carrying amount together with the associated

cumulative gain or loss that was reported in

equity is recognised in profi t or loss.

If the Group disposes of part of its holding

of a particular investment, the deemed cost

of the part sold is determined using the

weighted average method applied to the

carrying value of the total holding of the

investment.

(g) Investment properties

Investment properties are properties which

are held to earn rental income, for capital

appreciation or for both, but not for sale in

the ordinary course of business, use in the

production or supply of goods or services or

for administrative purposes.

Investment properties are stated at cost less

accumulated depreciation and impairment

losses.

Cost includes expenditure that is directly

attributable to the acquisition of the

investment property. The cost of self-

constructed investment property includes

the cost of materials and direct labour, and

other costs directly attributable to bringing

the investment property to a working

condition for its intended use and capitalised

borrowing costs.

Depreciation is charged to profi t or loss on a

straight-line basis over the estimated useful

lives of each property. The estimated useful

lives are as follows:

Buildings and improvements 20-30 years

Leasehold rights over land 25-30 years

(over the period of lease)

(h) Property, plant and equipment

Recognition and measurement

Owned assets

Property, plant and equipment are stated

at cost less accumulated depreciation and

impairment losses.

Cost includes expenditure that is directly

attributable to the acquisition of the asset.

The cost of self-constructed assets includes

the cost of materials and direct labour, any

other costs directly attributable to bringing

the assets to a working condition for their

intended use, the costs of dismantling and

removing the items and restoring the site

on which they are located, and capitalised

borrowing costs.

When parts of an item of property, plant and

equipment have diff erent useful lives, they

are accounted for as separate items (major

components) of property, plant and

equipment.

Gains and losses on disposal of an item of

property, plant and equipment are determined

by comparing the proceeds from disposal with

the carrying amount of property, plant and

equipment, and are recognised net within

other income in profi t or loss.

Depreciation

Depreciation is calculated based on the

depreciable amount, which is the cost of an

asset, or other amount substituted for cost,

less its residual value.

Depreciation is charged to profi t or loss on

a straight-line basis over the estimated

useful lives of each component of an item

of property and equipment. The estimated

useful lives are as follows:

Furniture, fi xtures

and equipment 5-15 years

Transportation equipment 5 years

No depreciation is provided on freehold

land or assets under construction.

Depreciation methods, useful lives and

residual values are reviewed at each fi nancial

year-end and adjusted if appropriate.

(i) Leasehold rights

Leasehold rights are recorded at cost less

accumulated amortisation and impairment

losses.

Amortisation

Leasehold rights are charged to profi t or loss

on a straight-line basis over the period of

lease as follows:

Leasehold rights over land and buildings

30 years (over the period of lease)

Leasehold rights over land

25-30 years (over the period of lease)

Leasehold right under sub-lease agreement,

which is an operating lease, with Central

International Development Co., Ltd. is

amortised on a systematic basis.

(j) Long-term leases

Where the Group is the lessee

Leases of property or equipment which

substantially transfer all the risks and rewards

of ownership to the lessees are classifi ed as

fi nance leases. Finance leases are capitalised

at the inception of the lease at the lower of

the fair value of the leased property or

the present value of the minimum lease

payments. Each lease payment is allocated

to the principal and to the fi nance charges so

as to achieve a constant rate on the fi nance

balance outstanding. The outstanding rental

obligations, net of finance charges, are

included in other long-term payables. The

interest element of the fi nance cost is charged

to profi t or loss over the lease period. The

property or equipment acquired under

fi nance leases is depreciated over the useful

life of the asset.

Leases not transferring a signifi cant portion

of the risks and rewards of ownership to

the lessee are classifi ed as operating leases.

Payments made under operating leases are

charged to profi t or loss on a straight-line

basis over the period of the lease. For long-

term leases where the Group does not occupy

the entire areas at the lease inception date,

lease expenses are charged to profi t or loss

on a systematic basis over the period of the

lease in proportion to the area that the Group

occupies in each year.

When an operating lease is terminated

before the lease period expires, any payment

required to be made to the lessor by way

of penalty is recognised as an expense

in the period in which the termination

takes place.

Where the Group is the lessor

Assets leased out under operating leases

are included in property and equipment in

the statement of fi nance position. They are

depreciated over their expected useful lives

on a basis consistent with other similar

property and equipment owned by the

Group. Rental income is recognised on a

straight-line basis over the lease term.

Assets leased out by the Group under which

a signifi cant portion of the risks and rewards

of ownership are transferred to the lessee are

classifi ed as fi nance lease. The assets held

under finance lease are recorded as

accounts receivable under fi nance lease in

the statements of fi nancial position.

The sales revenue recorded at the

commencement of a f inance lease

represents the fair value of the asset, or if

lower, the present value of the minimum

lease payments accruing to the lessor,

computed at a commercial rate of

interest. The cost of sale recognised at the

commencement of the lease term is the

cost or carrying amount of the leased

property. The diff erence between the sales

revenue and the cost of sale is recorded

as gain which is recognised by the Group

in accordance with its normal accounting

policy.


(k) Assets usage right

Assets usage rights that are acquired by the

Group are stated at cost less accumulated

amortisation and impairment losses.

Amortisation

Amortisation is calculated over the cost of the

asset, or other amount substituted for cost,

less its residual value.

Amortisation is recognised in profi t or loss

on a straight-line basis over the estimated

useful lives of intangible assets from the

date that they are available for use, since this

most closely refl ects the expected pattern of

consumption of the future economic benefi ts

embodied in the asset. The estimated useful

lives for the current and comparative periods

are as follows:

Assets usage rights 10 and 28 years

Amortisation methods, useful lives and

residual values are reviewed at each fi nancial

year-end and adjusted if appropriate.

(l) Impairment

The carrying amounts of the Group’s assets

are reviewed at each reporting date to

determine whether there is any indication

of impairment. If any such indication exists,

the assets’ recoverable amounts are estimated.

An impairment loss is recognised if the

carrying amount of an asset or its cash-

generating unit exceeds its recoverable

amount. The impairment loss is recognised

in profi t or loss.

When a decline in the fair value of an

available-for-sale fi nancial asset has been

recognised directly in equity and there is

objective evidence that the value of the

asset is impaired, the cumulative loss that

had been recognised directly in equity is

recognised in profi t or loss even though the

fi nancial asset has not been derecognised.

The amount of the cumulative loss that is

recognised in profi t or loss is the diff erence

between the acquisition cost and current

fair value, less any impairment loss on that

financial asset previously recognised in

profi t or loss.

Calculation of recoverable amount

The recoverable amount of the Group’s

investments in held-to-maturity securities is

calculated as the present value of estimated

future cash fl ows, discounted at the original

eff ective interest rate.

The recoverable amount of available-for-sale

fi nancial assets is calculated by reference to

the fair value.

The recoverable amount of a non-fi nancial

asset is the greater of the assets’ value in use

and fair value less cost to sell. In assessing

value in use, the estimated future cash fl ows

are discounted to their present value using

a pre-tax discount rate that refl ects current

market assessments of the time value of

money and the risks specifi c to the asset. For

an asset that does not generate cash infl ows

largely independent of those from other

assets, the recoverable amount is determined

for the cash-generating unit to which the

asset belongs.

Reversals of impairment

An impairment loss in respect of a fi nancial

asset is reversed if the subsequent increase

in recoverable amount can be related

objectively to an event occurring after the

impairment loss was recognised in profi t or

loss. For fi nancial assets carried at amortised

cost and available-for-sale fi nancial assets

that are debt securities, the reversal is

recognised in profi t or loss. For available-

for-sale financial assets that are equity

securities, the reversal is recognised in other

comprehensive income.

Impairment losses recognised in prior

periods in respect of other non-fi nancial assets

are assessed at each reporting date for any

indications that the loss has decreased or no

longer exists. An impairment loss is reversed

if there has been a change in the estimate

used to determine the recoverable amount.

An impairments loss is reversed only to the

extent that the asset’s carrying amount does

not exceed the carrying amount that would

have been determined, net of depreciation

or amortisation, if no impairment loss had

been recognised.

(m) Interest-bearing liabilities

Interest-bearing liabilities are recognised

initially at fair value.

(n) Trade and other accounts payable

Trade and other accounts payable are stated

at cost.

(o) Employee benefi ts

Defi ned contribution plans

A defined contribution plan is a post-

employment benefi t plan under which an

entity pays fi xed contributions into a separate

entity and will have no legal or constructive

obligation to pay further amounts. Obligations

for contributions to defined contribution

pension plans are recognised as an employee

benefi t expense in profi t or loss in the periods

during which services are rendered by

employees.

Defi ned benefi t plans

A defi ned benefi t plan is a post-employment

benefi t plan other than a defi ned contribution

plan. The Group’s net obligation in respect of

defi ned benefi t pension plans is calculated

separately for each plan by estimating the

amount of future benefit that employees

have earned in return for their service in

the current and prior periods; that benefi t is

discounted to determine its present value.

Any unrecognised past service costs and

the fair value of any plan assets are deducted.

The discount rate is the yield at the reporting

date on AA credit-rated bonds that have

maturity dates approximating the terms

of the Group’s obligations and that are

denominated in the same currency in which

the benefi ts are expected to be paid.

The calculation is performed annually by a

qualifi ed actuary using the projected unit

credit method. When the calculation results

in a benefi t to the Group, the recognised

asset is limited to the total of any unrecognised

past service costs and the present value of

economic benefi ts available in the form of

any future refunds from the plan or reductions

in future contributions to the plan. In order

to calculate the present value of economic

benefits, consideration is given to any

minimum funding requirements that apply

to any plan in the Group. An economic

benefit is available to the group if it is

realisable during the life of the plan, or on

settlement of the plan liabilities.

When the benefi ts of a plan are improved,

the portion of the increased benefi t relating

to past service by employees is recognised

in profi t or loss on a straight-line basis over

the average period until the benefi ts become

vested. To the extent that the benefi ts vest

immediately, the expense is recognised


The Group recognises all actuarial gains

and losses arising from defi ned benefi t plans

in other comprehensive income and all

expenses related to defi ned benefi t plans in

profi t or loss.

Short-term employee benefi ts

Short-term employee benefi t obligations are

measured on an undiscounted basis and are

expensed as the related service is provided.

A liability is recognised for the amount

expected to be paid under short-term cash

bonus or profi t-sharing plans if the Group/

Company has a present legal or constructive

obligation to pay this amount as a result of

past service provided by the employee, and

the obligation can be estimated reliably.

(p) Provisions

A provision is recognised if, as a result of a

past event, the Group has a present legal or

constructive obligation that can be estimated

reliably, and it is probable that an outfl ow of

economic benefi ts will be required to settle

the obligation. Provisions are determined by

discounting the expected future cash fl ows

at a pre-tax rate that refl ects current market

assessments of the time value of money and

the risks specifi c to the liability. The unwinding

of the discount is recognised as fi nance cost.

(q) Revenue

Revenue excludes value added taxes and is

arrived at after deduction of trade discounts

and special discount.

Revenue from rent and services

Revenue from rent is recognised in profi t or

loss on a straight-line basis over the term of

the lease. Revenue from services is recognised

as services are provided. Lease incentives

granted are recognised as a integral part of

the total revenue from rent. Contingent rentals

are recognised as income in the accounting

period in which they are earned. Unearned

rental and service revenue are recognised on

a straight-line basis over the term of the lease.

Revenue from food and beverage

Revenue from food and beverage is recognised

upon delivery of goods to customers.

Investment income

Investment income comprises interest and


dividend income from bank deposits and

investments.

Interest income

Interest income is recognised in profi t or

loss as it accrues.

Dividend income

Dividend income is recognised in profi t or

loss on the date the Group’s right to receive

payments is established which in the case of

quoted securities is usually the ex-dividend

date.

(r) Finance costs

Finance costs comprise interest expense on

borrowings, unwinding of the discount on

provisions and contingent consideration,

losses on disposal of available-for-sale

financial assets, dividends on preference

shares classified as liabilities, fair value

losses on financial assets at fair value

through profit or loss, impairment losses

recognised on fi nancial assets (other than

trade receivables), and losses on hedging

instruments that are recognised in profi t or

loss.

Borrowing costs that are not directly

attributable to the acquisition, construction

or production of a qualifying asset are

recognised in profit or loss using the

eff ective interest method.

(s) Lease payments

Payments made under operating leases are

recognised in profit or loss on a straight

line basis over the term of the lease. Lease

incentives received are recognised in profi t

or loss as an integral part of the total lease

payments made.

Contingent lease payments are accounted

for by revising the minimum lease payments

over the remaining term of the lease when the

lease adjustment is confi rmed.

Payments made under sub-lease agreement,

which is an operating lease, with Central

International Development Co., Ltd. is

recognised in profi t or loss on a systematic

basis.

(t) Income tax

Income tax expense for the year comprises

current and deferred tax. Current and

deferred tax are recognised in profi t or loss

except to the extent that they relate to a

business combination, or items recognised

directly in equity or in other comprehensive

income.

Current tax is the expected tax payable or

receivable on the taxable income or loss for

the year, using tax rates enacted at the

reporting date and any adjustment to tax

payable in respect of previous years.

Deferred tax is recognised in respect of

temporary diff erences between the carrying

amounts of assets and liabilities for fi nancial

reporting purposes and the amounts used

for taxation purposes. Deferred tax is not

recognised for the following temporary

differences: the initial recognition of

goodwill; the initial recognition of assets

or liabilities in transaction that is not a

business combination and that affects

neither accounting nor taxable profit or

loss; and diff erences relating to investments

is subsidiaries to the extent that it is probable

that they will not reverse in the foreseeable

future.

Deferred tax is measured at the tax rates that

are expected to be applied to the temporary

differences when they reverse, using tax

rates enacted or by the reporting date.

In determining the amount of current and

deferred tax, the Group takes into account

the impact of uncertain tax positions and

whether additional taxes and interest may

be due. The Group believes that its accruals

for tax liabilities are adequate for all open tax

years based on its assessment of many

factors, including interpretations of tax law and

prior experience. This assessment relies on

estimates and assumptions and may involve

a series of judgements about future events.

New information may become available that

causes the Group/Company to change its

judgement regarding the adequacy of

existing tax liabilities; such changes to tax

liabilities will impact tax expense in the

period that such a determination is made.

Deferred tax assets and liabilities are off set if

there is a legally enforceable right to off set

current tax liabilities and assets, and they

relate to income taxes levied by the same tax

authority on the same taxable entity, or on

different tax entities, but they intend to

settle current tax liabilities and assets on a net

basis or their tax assets and liabilities will be

realised simultaneously.

A deferred tax asset is recognised to the

extent that it is probable that future taxable

profi ts will be available against which the

temporary diff erence can be utilised. Deferred

tax assets are reviewed at each reporting date

and reduced to the extent that it is no longer

probable that the related tax benefi t will be

realised.

(u) Earnings per share

The Group/Company presents basic and

diluted earnings per share (EPS) data for its

ordinary shares. Basic EPS is calculated by

dividing the profit or loss attributable to

ordinary shareholders of the Group/Company

by the weighted average number of ordinary

shares outstanding during the year.

5 Acquisitions of subsidiary and

non-controlling interests

Acquisition of subsidiaries

During the year 2011, the Group obtained

control of CPN Complex Co.,Ltd., a property

management company by acquiring 99.9% of

the share and voting interest in the Company.

During the year 2011, the Company invested

in land relating to one project however

operations have not yet commenced.

The following summarises the major classes of consideration transferred, and the recognised amounts of net assets acquired and goodwill

was recognised as follows: (in thousand Baht)

Fair value

Total consideration transferred - cash 1,526,185

Fair value of identifi able net assets - land (1,526,185)

Goodwill -

During the year 2011, the Group obtained

control of CPN City Co.,Ltd., a property

management company by acquiring 99.9%

of the share and voting interest in the

Company. During the year 2011, the Company

invested in land relating to one project

however operations have not yet commenced.

The following summarises the major classes of consideration transferred, and the recognised amounts of net assets acquired and goodwill

was recognised as follows: (in thousand Baht)

Fair value

Total consideration transferred - cash 2,119,815

Fair value of identifi able net assets - land (2,119,815)

Goodwill -

Acquisition of non-controlling interests

In December 2011 the Group acquired an

additional 6.2% interest in Central Pattana

Nine Square Co.,Ltd. for Baht 1,150 million in

cash, increasing its ownership from 87.1% to

93.3%. The carrying amount of Central Pattana

Nine Square Co.,Ltd’s net assets in the Group’s

financial statements on the date of the

acquisition was Baht 894.4 million. The Group

recognised a decrease in non-controlling

interests of Baht 0.4 million and a decrease in

retained earnings of Baht 24.3 million.


The following summarises the eff ect of changes in the Group’s ownership interest in Central Pattana Nine Square Co.,Ltd:

(in thousand Baht)

2011

Group’s ownership interest at 1 January 745,753

Acquisitions of investments 1,150,000

Eff ect of decrease in Group’s ownership interest (24,693)

Share of comprehensive income (4,096)

Group’s ownership interest at 31 December 1,866,964

6 Related party transactions and

balances

For the purposes of these fi nancial statements,

parties are considered to be related to the

Group if the Group has the ability, directly or

indirectly, to control or joint control the party

or exercise signifi cant infl uence over the party

in making fi nancial and operating decisions,

or vice versa, or where the Group and the party

are subject to common control or common

signifi cant infl uence. Related parties may be

individuals or other entities.

Relationships with related parties were as follows:

Country ofName of entity incorporation/nationality Nature of relationships

Central Holding Co., Ltd. Thailand Major shareholder, some common directors

CPN Retail Growth Leasehold Property Fund Thailand Associate, holding 27.8%

Central Department Store Co., Ltd. Thailand Some common directors

Hang Central Department Store Co., Ltd. Thailand Some common directors

Central Trading Co., Ltd. Thailand Some common directors

Central Super Store Co., Ltd. Thailand Some common directors

Power Buy Co., Ltd. Thailand Some common directors

CRC Sport Co., Ltd. Thailand Some common directors

CRC Power Retail Co., Ltd. Thailand Some common directors

B2S Co., Ltd. Thailand Some common directors

Offi ce Club (Thai) Co., Ltd. Thailand Some common directors

Earth Care Co., Ltd. Thailand Some common directors

CR Chiangmai (Thailand) Co., Ltd. Thailand Some common directors

Central Garment Factory Co., Ltd. Thailand Some common directors

Samsonite (Thailand) Co., Ltd. Thailand Some common directors

Country ofName of entity incorporation/nationality Nature of relationships

Central Plaza Hotel Public Company Limited Thailand Some common directors

Central World Hotel Co., Ltd. Thailand Some common directors

Central Restaurant Group Co., Ltd. Thailand Some common directors

Central Food Retail Co., Ltd. Thailand Some common directors

Fuji Gimmick Co., Ltd. Thailand Some common directors

Sakura Restaurant Co., Ltd. Thailand Some common directors

Food Excellent Co., Ltd. Thailand Some common directors

Central International Development Co., Ltd. Thailand Some common directors

Robinson Nakarin Co.,Ltd. Thailand Some common directors

Robinson Department Store Public Company Limited Thailand Some common directors

Central Watson Co., Ltd. Thailand Some common directors

F&D International Co., Ltd. Thailand Some common directors

Food Festival Co., Ltd. Thailand Some common directors

Food Millennium Co., Ltd. Thailand Some common directors

Central Retail Corporation Co., Ltd. Thailand Some common directors

Fairy Plaza Co., Ltd. Thailand Some common directors

Big C Fairy Co., Ltd. Thailand Some common directors

Siam Retail Development Co., Ltd. Thailand Some common directors

Ayudhaya Agrocity Co., Ltd. Thailand Some common directors

Square Ritz Plaza Co., Ltd. Thailand Some common directors

Relationships between the Company and its subsidiaries and funds are disclosed in note 1.

Pricing policies for particular types of transactions are explained further below:

Transactions Pricing policies

Revenue from rent and services Market prices which are subject to location, lease space,lease form,

timing and type of lease

Revenue from food and beverage Market prices

Management income The rate being charged by other parties in the business

Other income The rate being charged by other parties in the business

Interest charged to wholly owned subsidiaries The average interest rate of debt securities issued by the Company

Interest charged to other subsidiaries and related parties The average interest rate of debt securities issued by the Company


Transactions Pricing policies

Cost of rent and services Market prices

Cost of food and beverage Market prices

Administrative expenses At cost

Management fee Contractually agreed prices

Provision for guarantee payment Contractually agreed prices

Leasehold rights Contractually agreed prices

Signifi cant transactions for the years ended 31 December 2011 and 2010 with related parties were as follows:

(in thousand Baht)


2011 2010 2011 2010

Revenue

Revenue from rent and services

Subsidiaries - - 54,166 82,939

Other related parties 1,903,291 1,630,122 679,822 765,212

Total 1,903,291 1,630,122 733,988 848,151

Revenue from food and beverage

Other related parties 3 1 - -

Management income

Subsidiaries and funds - - 110,982 48,843

Associate 262,330 289,659 262,330 289,658

Total 262,330 289,659 373,312 338,501

Interest income


Other related parties 4,802 197,648 4,687 197,644

Total 4,802 197,648 665,166 749,691

Other income



Total 57,381 56,950 152,877 178,999

(in thousand Baht)


2011 2010 2011 2010

Dividend income

Subsidiaries and funds - - 531,845 1,407,487

Associate 467,530 408,753 467,528 408,753

Total 467,530 408,753 999,373 1,816,240

Expenses

Cost of rent and services



Total 440,392 396,741 522,302 403,300

Cost of food and beverage

Other related parties 12 32 - -

Management fees

Subsidiaries and funds - - 13 -


Total 90,023 100,500 87,914 93,234

Administrative expenses



Total 18,307 17,608 60,589 40,873

Interest expense

Subsidiaries - - 162,003 173,832


Management benefi ts expenses

In 2011, the Company paid salaries, bonuses, meeting allowances and pensions to the directors and management members totaling Baht 78.2

million (2010: Baht 84.1 million).

Signifi cant balances as at 31 December 2011 and 2010 with related parties were as follows:

(in thousand Baht)


2011 2010 2011 2010

Trade accounts receivable

Subsidiaries:

CPN Pattaya Beach Co., Ltd. - - 24,811 3,839

Central Pattana Rattanathibet Co., Ltd. - - 18,154 2,349

Central Pattana Khon Kaen Co., Ltd. - - 16,797 3,982

Central World Co., Ltd. - - 14,128 5,067

Central Pattana Chonburi Co., Ltd. - - 11,952 2,009

CPN Chiangrai Co., Ltd. - - 5,888 -

Central Pattana Chiangmai Co., Ltd. - - 4,246 5,021

Bangna Central Property Co., Ltd. - - 3,432 4,335

Central Food Avenue Co.,Ltd. - - 1,187 1,006

Central Pattana Rama 2 Co., Ltd. - - 345 2,121

Central Realty Service Co., Ltd. - - - 1,055

Others - - 3,033 277

Total subsidiaries - - 103,973 31,061

Other related parties:

Central Department Store’s Group 70,131 83,092 28,051 27,226

Others 54,094 34,716 25,805 9,071

Total other related parties 124,225 117,808 53,856 36,297

Total 124,225 117,808 157,829 67,358

(in thousand Baht)


2011 2010 2011 2010

Accrued dividend income

Subsidiaries:

The Thai Business Fund 4 - - 865,922 865,922


Total - - 890,559 899,505

Accrued income

Subsidiary:


Other account payable

Subsidiaries:

Central World Co., Ltd. - - 57,363 -

The Thai Business Fund 4 - - 2,225,188 -

Other related party:

Central Department Store’s Group 121,961 - 121,961 -

Total 121,961 - 2,404,512 -

Accrued interest income:

Subsidiaries:


The Thai Business Fund 5 - - 455 449


Siam Retail Development Co., Ltd. 135,456 135,456 135,456 135,456

Total 135,456 135,456 146,037 143,733


Loans to related parties

(in thousand Baht)

Consolidated Separate Interest rate fi nancial statements fi nancial statements

2011 2010 2011 2010 2011 2010

(% per annum)

Short-term loans to

Subsidiaries:

The Thai Business Fund 4 6.00 6.50 - - 534,526 1,088,299

Langsuan Realty Co., Ltd. 3.98 4.44 - - 488,070 229,806

The Thai Business Fund 5 6.00 6.00 - - 89,206 105,296

Central Realty Service Co.,Ltd. 3.98 - - - 49,667 -

Central Pattana Chiangmai Co., Ltd. 3.98 4.44 - - - 268,600

Central Realty Service Rama 3 Co., Ltd. 3.98 4.44 - - - 4,518

Total short-term loans - - 1,161,469 1,696,519

Long-term loans to

Subsidiaries:

Central World Co., Ltd. 3.98 4.44 - - 10,870,881 6,246,663

CPN Chiangrai Co.,Ltd. 3.98 4.44 - - 1,376,088 1,069,364

Central Food Avenue Co., Ltd. 3.98 4.44 - - 581,382 108,909

Central Pattana Khon Kaen Co., Ltd. 3.98 4.44 - - 519,954 587,338

Central Pattana Rattanathibet Co., Ltd. 3.98 4.44 - - 462,209 635,266

CPN Pattaya Beach Co., Ltd. 3.98 4.44 - - 418,664 21,280

Central Pattana Chonburi Co., Ltd. 3.98 4.44 - - 368,804 712,968

Central Pattana Nine Square Co.,Ltd. 3.98 4.44 - - 1,752 1,233,622

CPN Pattaya Beach Hotel Co.,Ltd. 3.98 4.44 - - - 247,209

Total long-term loans to - - 14,599,734 10,862,619

Total loans to related parties, net - - 15,761,203 12,559,138

Summary of loans to related parties

Short-term loans - - 1,161,469 1,696,519

Long-term loans - - 14,599,734 10,862,619

- - 15,761,203 12,559,138

Less allowance for doubtful accounts - - - -

Total loans to related parties, net - - 15,761,203 12,559,138

(in thousand Baht)


2011 2010 2011 2010

Short-term

Subsidiaries

At 1 January - - 1,696,519 1,950,360

Increase - - 882,999 1,188,274

Decrease - - (1,418,049) (1,442,115)

At 31 December - - 1,161,469 1,696,519

Long-term

Subsidiaries

At 1 January - - 10,862,619 9,936,342

Increase - - 11,585,598 5,876,342

Decrease - - (7,848,483) (4,950,065)

At 31 December - - 14,599,734 10,862,619

Other related party

At 1 January - - - -

Reversal of allowance for doubtful account - 162,739 - 162,739

Decrease - (162,739) - (162,739)

At 31 December - - - -

Total long-term loans to related parties

At 1 January - - 10,862,619 9,936,342

Reversal of allowance for doubtful accounts - 162,739 - 162,739

Increase - - 11,585,598 5,876,342

Decrease - (162,739) (7,848,483) (5,112,804)

At 31 December - - 14,599,734 10,862,619

Loans to subsidiaries and other related

parties are unsecured and denominated in

Thai Baht, except the loan made to Central

Pattana Khon Kaen Co., Ltd., a subsidiary,

that is secured by the subsidiary’s land with

a carrying value as at 31 December 2011 of

Baht 327 million (2010:Baht 327 million).

All loans are repayable on demand. Loans

to subsidiaries and other related parties

carry interest at the average interest rate of

debt securities issued by the Company.

Movements during the years ended 31 December 2011 and 2010 of loans to related parties were as follows:


(in thousand Baht)


2011 2010 2011 2010

Trade accounts payable

Subsidiaries:

Central World Co., Ltd. - - 67,518 16,961

Central Realty Service Co., Ltd. - - 13,707 -

The Thai Business Fund 4 - - 6,153 -

Central Pattana Nine Square Co.,Ltd - - 4,610 -

Central Pattana Khon Kaen Co., Ltd. - - 3,067 2,657

Central Pattana Chiangmai Co., Ltd. - - 3,061 2,364

Bangna Central Property Co., Ltd. - - 2,278 2,887

CPN Pattaya Beach Co., Ltd. - - 1,629 1,617

CPN Chiangrai Co., Ltd. - - 1,307 -

Central Pattana Rattanathibet Co., Ltd. - - 880 2,282

Central Pattana Chonburi Co., Ltd. - - 875 1,689

Others - - 894 456

Total subsidiaries - - 105,979 30,913


Central Department Store’s Group 2,642 4,417 1,656 1,087

Others 3,570 1,572 3,327 179

Total related parties 6,212 5,989 4,983 1,266

Total 6,212 5,989 110,962 32,179

Account payable for leasehold right


Central International Development Co., Ltd. 645,464 852,343 645,464 852,343

Loans from related parties

(in thousand Baht)

Consolidated Separate Interest rate fi nancial statements fi nancial statements

2011 2010 2011 2010 2011 2010

(% per annum)

Short-term loans from

Subsidiaries:

Central Pattana Nine Square Co.,Ltd. 3.98 - - - 1,015,308 -

CPN Construction Management Co., Ltd. 3.98 4.44 - - 47,179 64,081

Central Pattana Chiangmai Co., Ltd. 3.98 - - - 31,047 -

CPN Global Co., Ltd. 3.98 4.44 - - 24,264 65,245

CPN Pattaya Beach Hotel Co., Ltd. 3.98 - - - 11,002 -


Others 5.50 5.50 3,815 3,687 - -

Total short-term loans 3,815 3,687 1,128,800 129,326

Long-term loans from

Subsidiaries:

Central Pattana Rama 3 Co., Ltd. 3.98 4.44 - - 1,519,019 1,854,621

Central Pattana Rama 2 Co., Ltd. 3.98 4.44 - - 1,830,666 1,554,837

Total long-term loans - - 3,349,685 3,409,458

Total loans from related parties 3,815 3,687 4,478,485 3,538,784


Movements during the years ended 31 December 2011 and 2010 of loans from related parties were as follows:

(in thousand Baht)


2011 2010 2011 2010

Short-term

Subsidiaries

At 1 January - - 129,326 528,554

Increase - - 1,892,696 1,282,350

Decrease - - (893,222) (1,681,578)

At 31 December - - 1,128,800 129,326

Other related parties

At 1 January 3,687 3,558 - -

Increase 128 129 - -

At 31 December 3,815 3,687 - -

Total short-term loans from related parties

At 1 January 3,687 3,558 129,326 528,554

Increase 128 129 1,892,696 1,282,350

Decrease - - (893,222) (1,681,578)

At 31 December 3,815 3,687 1,128,800 129,326

Long-term

Subsidiaries

At 1 January - - 3,409,458 3,264,011

Increase - - 316,389 1,763,280

Decrease - - (376,162) (1,617,833)

At 31 December - - 3,349,685 3,409,458

Other related parties

At 1 January - 18,429 - -

Increase - - - -

Decrease - (18,429) - -

At 31 December - - - -

(in thousand Baht)


2011 2010 2011 2010

Total long-term loans from related parties

At 1 January - 18,429 3,409,458 3,264,011

Increase - - 316,389 1,763,280

Decrease - (18,429) (376,162) (1,617,833)

At 31 December - - 3,349,685 3,409,458

Loans from related parties are unsecured and

denominated in Thai Baht. The loans are

repayable on demand. Loans from subsidiaries

and related parties carry interests at the

average interest rate of unsecured debt

securities issued by the Company. Loans

from funds carry interest at the rates ranging

from 4.0 % to 7.0 % per annum.

Key management personnel compensation

Key management personnel compensation for the years ended 31 December 2011 and 2010 consist of:

(in thousand Baht)


2011 2010 2011 2010

Short-term benefi ts 78,230 84,110 78,230 84,110

Long-term benefi ts 2,081 1,947 2,081 1,947

Total 80,311 86,057 80,311 86,057

Commitments with related parties

The Group has entered into service and premise lease agreements with related parties. The rental and service fees are payable as at 31

December 2011 and 2010 as follows: (in thousand Baht)


2011 2010 2011 2010

Non-cancellable operating lease commitments

Within one year 528 524 548 498

After one year but within fi ve years 2,427 2,403 2,506 2,300

After fi ve years 11,652 12,578 11,971 12,306

Total 14,607 15,505 15,025 15,104


The Company entered into a land lease

agreement with Hang Central Department

Store Co., Ltd., a related party, for a period of

30 years ended in 2024 (Note 37).

The Company entered into a land lease

agreement with Hang Central Department

Store Co., Ltd., a related party, for a period of

30 years ended in 2023.

A subsidiary has entered into an agreement

with Central Plaza Hotel Public Company

Limited to sublease its leasehold right over

land and part of its construction located at

Central World for 29 years. According to the

agreement, the sub-lessee agreed to use land

and its constructions to develop a hotel, a

parking and a convention hall.

Central World Co.,Ltd.

On 18 December 2002, Thai Business Fund 4

(TBF4) entered into a land and building lease

agreement, related to the location of Central

World Plaza with The Bureau of the Crown

Property. The lease agreement was for a

period of 30 years ending in December 2032.

On 23 December 2002, TBF4 entered into a

sublease utilities system contract and a real

estate management contract with Central

World Co., Ltd. The lease agreement was for

a period of 30 years and ending in December

2032. Under the conditions of the contracts,

the Company had to make an advance

lump sum payment of unearned leasehold

right in advance of Baht 80 million and

monthly rent stated in the contract to TBF4.

Central World had Central Pattana Public

Company Limited (“CPN”) as a guarantor.

According to the 7th TBF4’s unitholders’

resolution on 27 September 2011, unitholders

had an unanimous resolution to change

the sublessee from Central World Co., Ltd. to

CPN by cancelling a sublease utilities system

contract and a real estate management

contract with Central World Co., Ltd.

As a result, TBF4 terminated a sublease

utilities system contract and a real estate

management contract with Central World

on 1 December 2011 and had obligation to

pay compensation in amount of Baht 2,219

million for investment in system and

development of parking building by Central

World and contract termination. CPN agreed

to pay for the obligation on behalf of TBF4

in order to sublease utilities system contract

and become a real estate manager for

Central World project instead.

TBF4 has subleased the system to the CPN

on 1 December 2011. The contract covered

the period 1 December 2011 to the end of

December 2032. According to the contract,

the Company has to pay the lump sum rent

of Baht 56.1 million and pay the monthly rent

of Baht 20 million according to the contract.

Central Plaza Lardprao

In 2009, the Company subleased land and

shopping, office and parking buildings

including their improvements, integrated

components and equipment of Central

Plaza Lardprao from Central International

Development Company Limited for 20

years up until 18 December 2028. The

Company had to pay advance rental in the

amount of Baht 2,162 million, which is

classified as leasehold rights in the

statements of fi nancial position. In addition,

the Company is required to pay annual rent

throughout the agreement period totalling

Baht 14,016 million.

Titles over the buildings, premises or

properties the Company’s renovation,

development or erection will be transferred

to The State Railway of Thailand (“the

ultimate lessor”) upon expiry of the

agreement together with certain equipment

specifi ed in the lease agreement.

7 Cash and cash equivalents

(in thousand Baht)


2011 2010 2011 2010

Cash on hand 5,885 5,655 1,908 2,230

Call deposits 827,173 765,909 198,053 243,648

Total 833,058 771,564 199,961 245,878

Cash and cash equivalents of the Group and the Company as at 31 December 2011 and 2010 were denominated in Thai Baht.

8 Other investments

(in thousand Baht)


2011 2010 2011 2010

Current

Short-term deposits at fi nancial Institutions - 1,238 - 243

Debt securities held-to-maturities 197 750,895 - 750,000

Equity securities available-for-sale 105,323 105,323 1,025 1,025

Add unrealised holding gain 6,037 3,251 2,045 1,915

111,557 860,707 3,070 753,183

Non-current

Other equity securities 2,242 1,000 1,000 1,000

Total 113,799 861,707 4,070 754,183

Other investments of the Group and the Company as at 31 December 2011 and 2010 were entirely denominated in Thai Baht.


9 Trade accounts receivable

(in thousand Baht)


Note 2011 2010 2011 2010

Subsidiaries and other related parties 6 124,225 117,808 157,829 67,358

Other parties 766,881 539,165 353,264 147,685

891,106 656,973 511,093 215,043

Less allowance for doubtful accounts (9,861) (3,483) (1,574) (942)

Net 881,245 653,490 509,519 214,101

Bad and doubtful debt expenses (reverse) for the year 6,378 56 632 (1,251)

Aging analyses for trade accounts receivable and deposits from overdue customers were as follows:

(in thousand Baht)


2011 2010 2011 2010

Subsidiaries and other related parties

Within credit terms 42,021 45,597 120,689 38,088

Overdue:

Less than 3 months 39,148 20,672 24,390 14,416

3-6 months 18,002 12,891 2,998 4,308

6-12 months 7,720 27,884 3,012 8,454

Over 12 months 17,334 10,764 6,740 2,092

Total 124,225 117,808 157,829 67,358

Deposits from overdue customers 200,458 183,257 52,605 45,031

(in thousand Baht)


2011 2010 2011 2010

Other parties

Within credit terms 273,250 271,845 156,762 59,677

Overdue:

Less than 3 months 229,750 68,943 129,165 29,179

3-6 months 104,786 30,000 31,249 16,916

6-12 months 87,434 100,423 12,382 27,837

Over 12 months 71,661 67,954 23,706 14,076

766,881 539,165 353,264 147,685

Less allowance for doubtful accounts (9,861) (3,483) (1,574) (942)

Net 757,020 535,682 351,690 146,743

Deposits from overdue customers 1,215,809 1,329,900 349,553 596,003

The normal credit term granted by the Group and the Company ranges from 1 day to 30 days.

Accounts receivable of the Group and the Company as at 31 December 2011 and 2010 were denominated in Thai Baht.

Deposits received from overdue customers were in excess of the overdue receivables.

10 Other accounts receivable

(in thousand Baht)


Note 2011 2010 2011 2010

Accrued income 6 428,210 567,324 1,130,219 1,155,547

Receivables from Revenue Department 468,372 416,855 - -

Other accounts receivable 356,413 302,275 22,317 13,123

Prepaid expenses 140,850 138,342 112,801 108,378

Others 72,684 54,367 28,046 18,848

Total 1,466,529 1,479,163 1,293,383 1,295,896


11 Investments in subsidiaries and funds

Movements of investments in subsidiaries and funds for the years ended 31 December 2011 and 2010 are as follows;

(in thousand Baht)

Separate fi nancial statements

2011 2010

At 1 January 19,676,871 17,681,189

Acquisitions of investments 1,925,425 1,501,334

Acquisition of investment units 105,772 522,332

Disposal of investments and redemption of investment units (27,984) (27,984)

At 31 December 21,680,084 19,676,871

Thai Business Fund 4 (“TBF4”)

On 8 December 2010, the Company purchased

additional issues of investment units type A

and C of TBF4 for 72.1 million units at Baht

3.85 per unit, totalling Baht 278 million (see

note 6), and 52.2 million units at Baht 10 per

unit, totalling Baht 522 million, respectively.

The proceeds from the recapitalisation to

fund are earmarked for renovation of the

Central World Plaza Project (Project), payment

of compensation or return of rental deposit

to the shopping plaza’s sub-lessee/tenants

who terminated their sublease agreements,

distribution of financial assistance to

aff ected retailers, and use as working capital

during the Project’s renovation.

On 10 August 2011, the Company purchased

additional issues of investment units type A

and C of TBF4 for 14.6 million units at Baht

3.85 per unit, totalling Baht 56.2 million (see

note 6), and 10.6 million units at Baht 10 per

unit, totalling Baht 105.8 million, respectively,

for fund use for working capital during the

Project’s renovation.

Central Pattana Rama 3 Co., Ltd. and Central

Realty Service Rama 3 Co., Ltd.

On 16 June 2010, the Company purchased

common shares of Central Realty Service

Rama 3 Co., Ltd., an indirect subsidiary, from

Central Pattana Rama 3 Co., Ltd., a direct

subsidiary, at net book value of Baht 233

million. The Company paid for the cost

of acquisition on 22 June and 7 July 2010

respectively. Subsequent to the purchase,

Central Realty Service Rama 3 Co., Ltd. has

become the Company’s direct subsidiary.

The Board of Directors’ meeting on 10 August

2010 resolved to restructure the shareholdings

of two subsidiaries which are 99.9 percent

directly and indirectly owned by the

Company by:

1. Registering the dissolution of Central Realty

Service Rama 3 Co., Ltd. (“CR3”), whose major

operation was to provide utilities services

at Central Plaza Ratchda Rama 3 Shopping

Plaza. As part of the process, total assets and

liabilities of CR3 will be transferred to Central

Pattana Rama 3 Co., Ltd. Currently, CR3 is

undergoing the liquidation process.

2. Registering the increase in share capital of

Central Pattana Rama 3 Co., Ltd. (“CP3”), whose

main operation is the leasing of commercial

space of Central Plaza Ratchda Rama 3, from

Baht 126.7 million currently to Baht 324.7

million to support the transfer of assets and

liabilities from Central Realty Service Rama 3

Co., Ltd. Additional shares issued will be

off ered to CP3’s shareholder who holds the

same shareholding percentage in Central

Realty Service Rama 3 Co., Ltd.

The above restructurings have no impact

on the shareholding proportions or interests

of the Company and its subsidiaries as the

Company eff ectively holds 100% ownership

interests in both subsidiaries.

Central Food Avenue Co., Ltd.

At the extraordinary shareholders meeting

of Central Food Avenue Co., Ltd. held on

31 May 2010, the shareholders passed a

special resolution to increase the company’s

registered capital by Baht 4 million by issuing

0.4 million shares at Bath 10 par value. The

new shares issued have been fully paid up.

The subsidiary registered the increase in

share capital with the Ministry of Commerce

on 4 June 2010.

Central Pattana Khon Kaen Co., Ltd.

On 31 May 2010, the subsidiary called for the

remaining unpaid capital of 25% of the new

shares issued, or Baht 435 million. Accordingly,

the subsidiary’s newly issued share capital

has been fully paid up.

CPN Global Company Limited

At the Company’s Board of Directors’ meeting

held on 11 May 2010, the Board members

approved the acquisition of 9,994 common

shares of CPN Global Company Limited from

a related party to support the Company’s

overseas expansion. The subsidiary registered

10,000 shares at Baht 100 par value; 25% of

which, or Baht 0.3 million, have been paid up

as at 31 December 2010. Subsequently after the

acquisition, CPN Global Company Limited

has become the subsidiary of the Company.

To support the aforementioned overseas

expansion,

> CPN Global Co., Ltd. incorporated two

additional legal entities in Hong Kong namely

Global Retail Development & Investment Ltd.

and Global Commercial Property Ltd. on 16

April 2010 and 23 April 2010 respectively.

> Global Retail Development & Investment

Ltd. incorporated additional legal entity in

China namely Central (Shanghai) Management

Consulting Co., Ltd. on 19 October 2010. The

Company called for the unpaid capital of 20%

of the new shares issued, of HKS 2.3 million

on 13 January 2011 and the company called

for the remaining unpaid capital of 40.3% of

the new shares issued, of HKS 4 million on 9

September 2011.

CPN Pattaya Beach Hotel Co., Ltd.

At the extraordinary shareholders meeting

of CPN Pattaya Beach Hotel Co., Ltd. on 23

March 2010, the shareholders passed a

special resolution to increase the company’s

registered capital by Baht 999 million by

issuing 9.99 million shares at Baht 100 par

value. 75% of the new share issues, or Baht

749.3 million, has been paid up. The subsidiary

registered the increase in share capital with

the Ministry of Commerce on 25 March 2010.

On 30 July 2011, the subsidiary called for

the remaining unpaid capital of 25% of the

new shares issued, or Baht 249.8 million.

Accordingly, the subsidiary’s newly issued

share capital has been fully paid up.

CPN Chiangrai Co., Ltd.

At the extraordinary shareholders meeting of

CPN Chiangrai Co.,Ltd. on 2 February 2010, the

shareholders passed a special resolution to:

> change the company’s name from “Thaipat

Property Co., Ltd.” to “CPN Chiangrai Co., Ltd.”

The name change was registered with the

Ministry of Commerce on 15 February 2010.

> increase the company’s registered capital

by Baht 699 million by issuing 69.9 million

shares at Baht 10 par value. 25% of the new

share issues, or Baht 174.98 million, has

been paid up. The subsidiary registered the

increase in share capital with the Ministry of

Commerce on 15 February 2010.

On 16 September 2011, the subsidiary called

for the remaining unpaid capital of 75% of

the new shares issued, or Baht 525 million

shares at Baht 10 par value. Accordingly, the

subsidiary’s newly issued share capital has

been fully paid up.

Central Pattana Nine Square Co., Ltd.

On 16 December 2011, the subsidiary called

for the remaining unpaid capital of 44.23% of

the new shares issued, or Baht 1,150 million.

Accordingly, the subsidiary’s newly issued

share capital has been fully paid up.

CPN Complex Co., Ltd.

The subsidiaries acquired 99.9% of common

shares of CPN Complex Co.,Ltd. which had

authorized shares of Baht 1,341.6 million

(13.4 million shares at Baht 100 par value) and

the share capital was fully paid-up.

CPN City Co., Ltd.

The subsidiaries acquired 99.9% of common

shares of CPN City Co.,Ltd. which had

authorized shares of Baht 1,863.5 million

(18.6 million shares at Baht 100 par value) and

the share capital was fully paid-up.

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(1) Investments in The Thai Business Fund 4

and The Thai Business Fund 5 are investment

units (type C) which have rights to receive

dividends subordinated to the other types of

unitholders (type A and B).

(2) The Thai Business Fund 4

On 1 April 2009, the Company acquired

investment units of The Thai Business Fund 4,

ordinary shares of Central World Company

Limited and ordinary shares and/or rights

to receive cash and/or any benefi ts of the

remaining assets after the liquidation based

on the shareholding proportion of Central

World Tower Company Limited from the

minority interests totaling Baht 572.3 million

(including accrued dividend income). The

payment was made in cash amounting to

Baht 327.8 million and Aval of Baht 244.5

million (Maturing on 30 December 2009).

As a result, the Company recognised an

excess of acquirer’s interest in net fair value

of aquiree’s identifi able assets, liabilities and

contingent liabilities over cost in the statement

of income amounting to Baht 66.0 million.

During 2009, the Company purchased 6.3%

of investment units of the Thai Business

Fund 4 which was held by Bangna Central

Property Co., Ltd., (indirect subsidiary), at

book value of Baht 335.6 million (including

accrued dividend income).

In 2009, the Thai Business Fund 4 amended

the dividend payment policy for investment

units type C which should not be less than

net cash remaining after (1) the dividend

paid and payable to investment units type A

and B, (2) the redemption of capital to

investment units type A and B, (3) the

deduction of cash reserved for other debt

payments and (4) the payment for dividend

payable. As at 31 December 2009, the Thai

Business Fund 4 appropriated and recorded

dividend payable of investment units type C

totaling Baht 941.2 million including dividend

payable to the Company of Baht 865.9 million

(See note 6).

During 2009, the Company purchased

investment units type A and B of The Thai

Business Fund 4 from fi nancial institutions

totaling Baht 1,794.4 million (See note 6).

Such investment unit purchase had no eff ect

on capital and proportion of units that have

rights to receive the dividends (Investment

units type C).

12 Investment in associate

Movements of investment in associate for the years ended 31 December 2011 and 2010 were as follows:

(in thousand Baht)


2011 2010 2011 2010

At 1 January 2,684,150 2,617,780 4,446,171 4,446,171

Share of net profi t of

investment-equity method 497,550 475,123 - -

Dividend income (467,530) (408,753) - -

At 31 December 2,714,170 2,684,150 4,446,171 4,446,171

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The following summarised fi nancial information of associated company which has been accounted for using the equity method is not

adjusted for the percentage of ownership held by the Group:

(in thousand Baht)

Ownership Total assets Total liabilities Total revenues Net profi t

(%)

2011

CPN Retail Growth

Leasehold Property Fund 27.8 18,601,705 1,582,789 2,309,989 1,789,632

Total 18,601,705 1,582,789 2,309,989 1,789,632

2010

CPN Retail Growth

Leasehold Property Fund 27.8 18,290,333 1,481,747 2,279,056 1,747,626

Total 18,290,333 1,481,747 2,279,056 1,747,626

13 Long-term investments - related parties

(in thousand Baht)

Ownership Consolidated Separate interest fi nancial statements fi nancial statements

2011 2010 2011 2010 2011 2010

(%)

Siam Retail Development Co., Ltd. 15 15 66,250 66,250 - -

Ayudhaya Agrocity Co., Ltd. 12 12 50,397 50,397 - -

Square Ritz Plaza Co., Ltd. 12 12 15,000 15,000 - -

Total investment, at cost 131,647 131,647 - -

Less allowance for impairment (131,647) (131,647) - -

Net - - - -


14 Investment properties

(in thousand Baht)


2011 2010 2011 2010

For the year ended 31 December

Cost

At 1 January 37,792,750 35,919,974 7,972,648 7,741,321

Additions 12,062,469 2,595,223 1,155,804 235,506

Transfer from property, plant and equipment 660,214 494,478 142,784 -

Transfer to property, plant and equipment (88,394) (48,774) (101,005) -

Transfer to leasehold rights - (792,293) - -

Disposals (23,942) (375,858) (2,595) (4,179)

At 31 December 50,403,097 37,792,750 9,167,636 7,972,648

Depreciation and impairment losses

At 1 January 7,837,840 6,717,709 1,526,385 1,180,920

Depreciation charge for the year 1,610,282 1,291,951 350,440 345,569

Reversal of impairment losses (187,015) - (91,226) -

Transfer from property, plant and equipment 432,474 17,522 83,316 -

Transfer to property, plant and equipments (25,387) (30,369) (25,387) -

Transfer from leasehold rights - 144,044 - -

Obligation under long-term operating lease 11,988 11,440 - -

Disposals (19,858) (314,457) (1,333) (104)

At 31 December 9,660,324 7,837,840 1,842,195 1,526,385

Net book value

At 1 January 2010 - 29,202,265 - 6,560,401

At 31 December 2010 and 1 January 2011 29,954,910 29,954,910 6,446,263 6,446,263

At 31 December 2011 40,742,773 - 7,325,441 -

Investment properties were revalued as at 31

December 2011 by Brooke Real Estate Co., Ltd.,

a fi rm of independent professional valuers,

using a “Income method, DCF Technique”.

The appraised value was Baht 74,805 million.

Investment properties comprise a number of

commercial properties that are leased to third

parties. One property has been transferred

from property, plant and equipment and

leasehold rights to investment property and

are consist of:

Central Plaza Chiangmai Airport

Central Plaza Ramindra

Central Plaza Bangna

Central Plaza Pinklao

Central Centre Pattaya

Central Plaza Ratchada - Rama 3

Central Plaza Rattanathibet

Central Plaza Changwattana

Central Festival Pattaya Beach

Central Plaza Udonthani

Central Plaza Chonburi

Central Plaza Khonkhan

Central Plaza Chiangrai

Central Plaza Pisanulok

Central Plaza Grand Rama 9

Central City Residential

Chaengwattana Offi ce

Bangna Offi ce

Langsuan Colonade

Project under development

The Group’s projects under development

consist of 9 shopping centre and office

building development projects.

During the period 2011, the Company

purchased a land from a third party of Baht

1,155.8 million for future development and

construction of a shop building and

department store. The payments was fully

paid in cash.

During 2010, the Group:

> purchased land worth Baht 449.8 million

from a third party for future development of

a shop building and department store; and

> purchased land worth Bath 148.8 million

from a third party for future development

of a shop building and department store.

The payments were made in cash in the

amount of Baht 100.0 million and in aval in

the amount of Baht 48.8 million (maturing

on 28 August 2010).


15 Property, plant and equipment

(a) Group

(in thousand Baht)

Consolidated fi nancial statements

Transportation

Buildings and and offi ce Construction Projects under

Land improvements equipments in progress development Total

Cost

At 1 January 2010 91,371 290,996 1,023,206 516,970 495,550 2,418,093

Purchase - 2,109 114,155 17,409 1,046,261 1,179,934

Transfer from investment property - - 48,774 - - 48,774

Transfer to investment property - - - (494,478) - (494,478)

Transfer - net - 1,433,862 43,249 64,700 (1,541,811) -

Disposals /write off - (40) (4,588) (6,374) - (11,002)

At 31 December 2010 and 1 January 2011 91,371 1,726,927 1,224,796 98,227 - 3,141,321

Purchase - 2,206 185,228 420,457 - 607,891

Transfer from investment property - 60,906 - 27,488 88,394

Transfer to investment property - - (660,214) - - (660,214)

Transfer - net - 243,053 43,887 (286,940) - -

Disposals / write off - (53,209) (153,672) (40,019) - (246,900)

At 31 December 2011 91,371 1,979,883 640,025 219,213 - 2,930,492

Depreciation

At 1 January 2010 - 27,143 615,223 - - 642,366

Depreciation charge for the year - 61,122 72,412 - - 133,534

Transfer from investment property - - 30,369 30,369

Transfer to investment property - (17,522) - - - (17,522)

Disposals / write off - - (1,776) - - (1,776)

At 31 December 2010 and 1 January 2011 - 70,743 716,228 - - 786,971

Depreciation charge for the year - 133,075 107,805 - - 240,880

Transfer from investment property - 25,387 - - - 25,387

Transfer to investment property - - (432,474) - - (432,474)

Disposals / write off - (12,249) (101,263) - - (113,512)

At 31 December 2011 - 216,956 290,296 - - 507,252

(in thousand Baht)


Transportation

Buildings and and offi ce Construction Projects under

Land improvements equipments in progress development Total

Net book value

At 1 January 2010

Owned assets 91,371 263,853 406,661 516,970 495,550 1,774,405

Assets under fi nance leases - - 1,322 - - 1,322

91,371 263,853 407,983 516,970 495,550 1,775,727

At 31 December 2010 and 1 January 2011

Owned assets 91,371 1,656,184 501,879 98,227 - 2,347,661


91,371 1,656,184 508,568 98,227 - 2,354,350

At 31 December 2011

Owned assets 91,371 1,762,927 344,311 219,213 - 2,417,822


91,371 1,762,927 349,729 219,213 - 2,423,240

Property, plant and equipment and offi ce

equipments consist of the Hilton Pattaya

and Centara Hotel Udonthani.

The gross amount of the Group’s fully

depreciated property, plant and equipment

that was still in use as at 31 December 2011

amounted to Baht 159 million (2010: Baht

100 million).

Collateral

As at 31 December 2011, long-term borrowings,

as discussed in note 20, are secured by the

Group’s properties with book values of Baht

21,442 million (2010: Baht 17,555 million).


(b) Company

(in thousand Baht)


Transportation

Buildings and and offi ce Construction improvements equipments in progress Total

Cost

At 1 January 2010 - 362,900 - 362,900

Additions - 68,058 8,571 76,629

Transfer - net - 691 (691) -

Disposals / write off - (3,474) (5,950) (9,424)

At 31 December 2010 and 1 January 2011 - 428,175 1,930 430,105

Additions - 115,269 95,070 210,339

Transfer - net - 18,306 (18,306) -

Transfer from investment property 60,906 - 40,099 101,005

Transfer to investment property - (142,784) - (142,784)

Disposals / write off - (11,772) (10,824) (22,596)

At 31 December 2011 60,906 407,194 107,969 576,069

Depreciation

At 1 January 2010 - 210,444 - 210,444

Depreciation charge for the year - 57,044 - 57,044

Disposals / write off - (2,812) - (2,812)

At 31 December 2010 and 1 January 2011 - 264,676 - 264,676

Depreciation charge for the year 4,350 45,608 - 49,958

Transfer from investment property 25,387 - - 25,387

Transfer to investment property - (83,316) - (83,316)

Disposals / write off - (11,711) - (11,711)

At 31 December 2011 29,737 215,257 - 244,994

(in thousand Baht)


Transportation

Buildings and and offi ce Construction improvements equipments in progress Total

Net book value

At 1 January 2010

Owned assets - 151,134 - 151,134

Assets under fi nance leases - 1,322 - 1,322

- 152,456 - 152,456

At 31 December 2010 and 1 January 2011

Owned assets - 156,810 1,930 158,740


- 163,499 1,930 165,429

At 31 December 2011

Owned assets 31,169 186,519 107,969 325,657


31,169 191,937 107,969 331,075

The gross amount of the Group’s fully

depreciated property, plant and equipment

that was still in use as at 31 December 2011

amounted to Baht 122 million (2010: Baht

87 million).

Collateral

As at 31 December 2011, long-term borrowings,

as discussed in note 20, are secured by the

Company’s properties with book values of

Baht 4,194 million (2010: Baht 4,399 million).


16 Leasehold rights

(in thousand Baht)


Cost

At 1 January 16,713,141 2,209,932

Purchase 2,855,034 510,716

Transfer from investment property 792,293 -

Disposals / transfer (1,050,588) -

At 31 December 2010 and 1 January 2011 19,309,880 2,720,648

Purchase 1,927,015 3,856,666

Disposals / transfer (485,970) -

At 31 December 2011 20,750,925 6,577,314

Amortisation

At 1 January 2010 4,814,603 376,895

Amortisation for the year 930,755 108,450

Transfer to investment property (144,044) -


Obligation under long-term operating leases 405,168 267,506

At 31 December 2010 and 1 January 2011 5,761,135 752,851

Amortisation for the year 1,096,772 174,242


Obligation under long-term operating leases 455,171 342,699

At 31 December 2011 7,273,379 1,269,792

Net book value

At 1 January 2010 11,898,538 1,833,037

At 31 December 2010 and 1 January 2011 13,548,745 1,967,797

At 31 December 2011 13,477,546 5,307,522

Most of the Group’s leasehold rights, Central

World Tower and Central Plaza Lardprao, are

leased under long-term operating leases.

As at 31 December 2011, the Group has

obligation under long-term lease agreement

amounting to Baht 2,447 million (2010: Baht

1,980 million) which resulted from the

diff erence between the actual rent paid and

systematic amortisation according to TAS 17

(revised 2009): Leases. The obligation under

long-term lease agreement is presented net

with the advance paid for leasehold rights

over land and buildings for which the rents

have been prepaid.

17 Assets usage rights

(in thousand Baht)


Cost

At 1 January 2010 217,543

Disposal (307)

At 31 December 2010 and 1 January 2011 217,236

Purchase 213

At 31 December 2011 217,449

Amortisation

At 1 January 2010 42,637

Amortisation charge for the year 9,027


Amortisation charge for the year 8,993

At 31 December 2011 60,657

Net book value

At 1 January 2010 174,906


At 31 December 2011 156,792


18 Deferred tax

Deferred tax assets and liabilities as at 31 December 2011 and 2010 were as follows:

(in thousand Baht)


2011 2010 2011 2010

Deferred tax assets 948,028 1,100,982 418,373 504,174

Deferred tax liabilities (1,030,885) (1,686,869) (649,008) (1,050,445)

Net (82,857) (585,887) (230,635) (546,271)

Movements in total deferred tax assets and liabilities during the year were as follows:

(in thousand Baht)


(charge) / credit to statement of At 1 January 2011 income (note 33) At 31 December 2011

Deferred tax assets

Allowance for doubtful accounts 1,045 (399) 646

Allowance for impairment 195,515 (31,376) 164,139

Building under consignment sale 324,754 (151,595) 173,159

Deposits from customers 394,079 (47,068) 347,011

Loss carry forward - 48,794 48,794

Liabilities under long-term operating leases 158,530 28,343 186,873

Defi ned benefi t obligation 27,059 (5,265) 21,794

Others - 5,612 5,612

Total 1,100,982 (152,954) 948,028

Deferred tax liabilities

Gain on lease under fi nance lease (1,677,091) 646,206 (1,030,885)

Others (9,778) 9,778 -

Total (1,686,869) 655,984 (1,030,885)

Net (585,887) 503,030 (82,857)

(in thousand Baht)



Deferred tax assets

Allowance for doubtful accounts 49,851 (48,806) 1,045


Building under consignment sale 347,361 (22,606) 324,755

Deposits from customers 308,268 85,810 394,078


Defi ned benefi t obligations 24,927 2,132 27,059

Total 1,015,795 85,187 1,100,982



Others (59,205) 49,427 (9,778)

Total (1,871,220) 184,351 (1,686,869)

Net (855,425) 269,538 (585,887)

(in thousand Baht)



Deferred tax assets

Allowance for doubtful accounts 282 30 312


Deposits from customers 179,082 (37,532) 141,550


Defi ned benefi t obligation 23,697 (4,489) 19,208

Others 20,052 (419) 19,633

Total 504,174 (85,801) 418,373

Deferred tax liability

Gain on lease under fi nance lease (1,050,445) 401,437 (649,008)

Total (1,050,445) 401,437 (649,008)

Net (546,271) 315,636 (230,635)


(in thousand Baht)



Deferred tax assets

Allowance for doubtful accounts 49,480 (49,198) 282

Allowance for impairment 121,376 - 121,376

Deposits from customers 155,129 23,953 179,082


Defi ned benefi t obligation 22,025 1,672 23,697

Others 34,421 (14,369) 20,052

Total 461,865 42,309 504,174



Total (1,141,181) 90,736 (1,050,445)

Net (679,316) 133,045 (546,271)

19 Other non-current assets

(in thousand Baht)


Note 2011 2010 2011 2010

Accrued interest receivable 6 135,456 135,456 135,456 135,456

Withholding tax deducted at source 92,695 50,515 - -

Deposits and other rights 63,203 95,077 15,757 15,397

Guarantees for leasehold rights 10,631 13,718 10,031 13,118

Total 301,985 294,766 161,244 163,971

20 Interest-bearing liabilities

(in thousand Baht)


Note 2011 2010 2011 2010

Current

Unsecured short-term loans from

related parties 6 3,815 3,687 1,128,800 129,326

Unsecured short-term loans from

fi nancial institutions 500,000 1,100,000 500,000 1,100,000

Secured current portion of long-term loans from

fi nancial institutions

- secured 1,270,080 1,380,089 500,040 550,050

- unsecured 600,000 - 600,000 -

1,870,080 1,380,089 1,100,040 550,050

Current portion of long-term loans from

institutional investors

- secured 109,838 109,838 - -

- unsecured 4,500,000 1,500,000 4,500,000 1,500,000

4,609,838 1,609,838 4,500,000 1,500,000

Total current portion of long-term loans 6,479,918 2,989,927 5,600,040 2,050,050

Non-current

Unsecured long-term loans from

related parties 6 - - 3,349,685 3,409,458

Secured long-term loans from

fi nancial institutions

- secured 5,674,830 4,594,910 1,549,910 1,949,950

- unsecured 1,900,000 - 1,900,000 -

7,574,830 4,594,910 3,449,910 1,949,950

Long-term loans from institutional investors

- secured 489,934 599,771 - -

- unsecured 10,200,000 9,800,000 10,200,000 9,800,000

10,689,934 10,399,771 10,200,000 9,800,000

Total other long-term loans payable 18,264,764 14,994,681 13,649,910 11,749,950

Total 25,248,497 19,088,295 24,228,435 18,438,784


The periods to maturity of interest-bearing liabilities, as at 31 December were as follows:

(in thousand Baht)


2011 2010 2011 2010

Within one year 6,983,733 4,093,614 7,228,840 3,279,376

After one year but within fi ve years 15,820,764 14,710,681 15,199,595 15,159,408

After fi ve years 2,444,000 284,000 1,800,000 -

Total 25,248,497 19,088,295 24,228,435 18,438,784

Secured interest-bearing liabilities as at 31 December were secured on the following assets:

(in thousand Baht)


2011 2010 2011 2010

Land 2,470,142 2,470,142 874,425 874,425

Leasehold rights over land 1,297,346 828,098 - -

Buildings and improvements 17,674,976 14,256,458 3,319,082 3,524,165

Total 21,442,464 17,554,698 4,193,507 4,398,590

As at 31 December 2011 the Group had

unutilised credit facilities totalling Baht

9,091 million (2010: Baht 5,005 million).

In December 2011, the Company issued

through private placement Baht 1,000 million

worth of Thai Baht denominated, name

registered, unsubordinated and unsecured

debentures without debentureholders’

representative. The debentures have term to

maturity of 3 years and 6 months, maturing

on 29 June 2015, and pay interest every

six-month period at 3.83% per annum.


through private placement Baht 1,000 million




representative. The debentures have term

to maturity of 5 years and 1 month, maturing

on 29 June 2017, and pay interest every


In October 2011, the Company issued through

private placement Baht 1,200 million worth

of Thai Baht denominated, name registered,

unsubordinated and unsecured debentures

without debentureholders’ representative. The

debentures have term to maturity of 5 years,

maturing on 12 October 2016, and pay interest

every six-month period at 4.52% per annum.


private placement Baht 500 million worth of

Thai Baht denominated, name registered,














In September 2011, the Company entered into

a Baht 1,500 million credit facility agreement

with a fi nancial institution. Such agreement

stipulates that the Company repays the

principle in 36 monthly instalments of Baht

41.7 million each on the last working day of

the month, beginning in September 2013.

The Company agrees to pay interest rate at

MLR less 3.00% p.a. As at 30 September 2011,

the Company has already utilised Baht 500

million of the said facility.

In April 2011, the Company issued through

private placement Baht 1,000 million worth

of Thai Baht denominated, name registered,




maturing on 29 March 2016, and pay interest


In March 2011, the Company issued through






maturing on 25 March 2016, and pay interest


In February 2011, the Company entered into

a Baht 500 million loan agreement with a

fi nancial institution. Such agreement stipulates

that the Company repays the principle every

three-month period in 8 periods of instalments

of Baht 62.5 million each the fi rst instalment

will be made on the last working day of April

2013 onwards. The Company agrees to pay

interest rate at 3.84% p.a. As at 30 September

2011, the Company has already fully utilised

of the said facility.


through private placement Baht 500 million




representative. The debentures have term

to maturity of 5 years, maturing on 28

December 2015, and pay interest every


In December 2010, the Company entered

into a Baht 1.5 billion credit facility agreement

with a fi nancial institution. Such agreement

stipulates that the Company repays the

principle in 30 monthly installments of Baht

50 million each on the last working day of

the month, beginning in January 2012. The

Company agrees to pay interest from the fi rst

drawdown date until 31 December 2011 at the

market rate; and from 1 January 2012 onwards

at 1M-THBFIX plus 1.05% p.a. As at 30 June

2011, the Company has already fully utilised

of the said facility.

In December 2010, the Company entered into

a Baht 1.5 billion credit facility (Term Loan)

agreement with a fi nancial institution. Such

agreement stipulates that the Company shall

completely repay the drawn down amount,

which carries interest charge at THBFIX plus

1.20% p.a., by the end of September 2014. The

Company agrees to pay interest on the last

working day of the month and return principle

in quarterly installments of not less than Baht

125 million each, beginning in December

2011. As at 30 September 2011, the Company

has already fully utilised of the said facility.

In December 2010, the Company retired its

Baht 1.5 billion unsecured and unsubordinated

debenture No. 2/2547 (CPN10DA) as it came

to maturity in the month.

In June 2010, the Company issued to

institutional investors Baht 500 million worth

of Thai Baht denominated, unsubordinated

and unsecured debentures with the term

to maturity of 2 years, maturing on 9 June

2012. The debentures pay interest every

three-month period at a fl oating interest rate

of 3MFDR+1.15% per annum.

In September 2011, a subsidiary has a loan

denominated in Thai Baht of Baht 2,000

million from a local fi nancial institution. The

agreement is for a period of 7 years and covers

a grace period of 2 years from the date that

the fi rst portion of loan is drawn down. The

loan bears a fi xed interest rate at 4.65% per

annum after that the interest rate will be at

MLR-2.125% per annum and the fi rst repayment

of principle every three-month period in 20

instalments of Baht 100 million for each

period. The subsidiary used its leasehold rights

to land and a pledged building as collateral

for the borrowing, which is also guaranteed

by the Company. As at 31 December 2011, the

said subsidiary has already drawn Baht 1,700

million of the said facility.


During 2009, a subsidiary has a loan


million from a local financial institution.

The agreement is for a period of 7 years and

covers a grace period of 2 years from the date

that the fi rst portion of loan is drawn down.

The loan bears interest at MLR-2.00 % per

annum and the first repayment due in

February 2011. The loan is payable in 60

instalments. The subsidiary used its leasehold

rights to land and a pledged building as

collateral for the borrowing, which is also

guaranteed by the Company. As at 31

December 2010, the loan facility has been

completely utilised.



million from a local financial institution.




The loan bears interest at MLR-2.00% per

annum and the first repayment due in

October 2010. The loan is payable in 60

instalments. The subsidiary used its land

and a pledged building as collateral for the

borrowing. On 28 April 2011, the Company

has entered into an amendment to loan

denominated in order to change the interest

rate from MLR-2.00% per annum to 4.50% per

annum until March 2014. After that the loan

bears interest at MLR-2.00% per annum until

mature in September 2015. As at 31 March 2010,

the loan facility has been completely utilised.



million from a local fi nancial institution. The

agreement is for a period of 7 years and covers

a grace period of 2 years from the date that

the fi rst portion of loan is drawn down. The

loan bears interest at MLR-1.75% per annum

and the fi rst repayment due in January 2011.

The loan is payable in 60 instalments. The

subsidiary used its leasehold right to land

and a pledged land and building as collateral

for the borrowing with a guarantee by the

Company. As at 31 March 2011 the loan facility

has been completely utilised.



million from a local commercial bank.




The loan bears interest at MLR-2.00% per

annum. The loan is payable in 60 instalments.

The subsidiary used its subleased land and

a pledged building as collateral for the

borrowing with a guarantee by the Company.

As at 31 March 2011, the loan facility has been

completely utilised.

During 2008, The Company obtained a loan

which is denominated in Thai Baht in the

amount of Baht 2,500 million from a local

commercial bank. The agreement is for a

period of 7 years and no principal is payable

until October 2010. The loan bears interest at

MLR-2.0% per annum. The loan is payable in

60 instalments. The Company uses its land

and building as collateral.

During the year 2007, the Company issued

unsecured and unsubordinated debentures,

denominated in Thai Baht 3,000 million, off ered

to institutional investors and maturing in

2012, bearing interest rate 4.25% per annum.

During 2008, the Company issued unsecured

and unsubordinated debentures, denominated

in Thai Baht 1,500 million, offered to

institutional investors and maturing in 2011,

bearing interest rate at 4.80% per annum.

The Company retrieved debenture in

September 2011.
















As at 31 December 2011, Baht 7,545 million

worth of interest-bearing and secured

liabilities of the Group (2010: Baht 6,685

million) have been secured by Investment

property, Property, plant and equipment and

Leasehold right on land under project being

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21 Provision for guarantee payment

In 2010, the Company recorded disbursement

of Baht 14.7 million out of Baht 30.97 million

previously allocated in 2009 as a provision

for guarantee payment, as discussed in

note 37, to compensate for the shortfall

of the 2010 net property income (before

leasing commission) which CPN Retail

Growth Leasehold Property Fund (CPNRF)

earned from Central Plaza Pinklao Shopping

Complex.

22 Other accounts payable

(in thousand Baht)


Note 2011 2010 2011 2010

Other accounts payable 6 1,415,032 325,841 2,631,049 155,236

Accrued expenses 1,591,373 1,357,730 656,946 478,441

Retention payable 755,860 412,310 117,659 54,162

Accrued interest expense 74,649 59,742 74,868 60,601

Unearned income 95,882 103,245 45,017 42,530

Others 566,582 397,910 237,003 155,352

Total 4,499,378 2,656,778 3,762,542 946,322

23 Employee benefi t obligations

The Group adopted TAS 19 – Employee

Benefits with effect from 1 January 2011;

the effect on the financial statements is

discussed in note 3 (h). As stated in note 3 (h),

the Group has opted to apply the new standard

retrospectively and adjust the prior year’s

fi nancial statements accordingly.

The Group and the Company operate defi ned

benefi t plans based on the requirement of

Thai Labour Protection Act B.E. 2541 (1998)

to provide retirement benefi ts to employees

based on pensionable remuneration and

length of service.

Movement in the present value of the defi ned benefi t obligations:

(in thousand Baht)


2011 2010 2011 2010

Defi ned benefi t obligations at 1 January 94,270 86,504 78,990 73,415

Benefi ts paid by the plan (691) (7,639) (585) (7,209)

Current service costs and interest 16,688 15,405 17,635 12,784

Defi ned benefi t obligations at 31 December 110,267 94,270 96,040 78,990

Expense recognised in profi t or loss:

(in thousand Baht)


2011 2010 2011 2010


Current service costs 12,163 11,271 13,540 9,294

Interest cost 4,525 4,134 4,095 3,490

Total 16,688 15,405 17,635 12,784

The expense is recognised in the following line items in the statement of comprehensive income:

(in thousand Baht)


2011 2010 2011 2010


Cost of rental and service 3,410 3,282 4,326 1,415

Cost of food and beverage 160 148 - -

Administrative expenses 13,118 11,975 13,309 11,369

Total 16,688 15,405 17,635 12,784

Principal actuarial assumptions at the reporting date:

(%)


2011 2010 2011 2010

Average discount rate at 31 December 5 5 5 5

Average future salary increases 6 6 6 6

Mortality assumption of the mortality rate is based from Thailand Mortality Ordinary issued by the Offi ce of the Insurance Commission.


24 Share capital

(thousand share / thousand Baht)

2011 2010

Par Value Number Baht Number Baht

(in Baht)

Authorised

At 1 January

- ordinary shares 1 2,178,816 2,178,816 2,178,816 2,178,816

At 31 December

- ordinary shares 1 2,178,816 2,178,816 2,178,816 2,178,816

Issued and paid-up

At 1 January

- ordinary shares 1 2,178,816 2,178,816 2,178,816 2,178,816

At 31 December

- ordinary shares 1 2,178,816 2,178,816 2,178,816 2,178,816

Share premium

Section 51 of the Public Companies Act B.E.

2535 requires companies to set aside share

subscription monies received in excess of

the par value of the shares issued as a reserve

account (“share premium”). Share premium is

not available for dividend distribution.

25 Reserves

Reserves comprise:

Appropriations of profi t and/or

retained earnings

Legal reserve

Section 116 of the Public Companies Act

B.E. 2535 Section 116 requires that a public

company shall allocate not less than 5% of

its annual net profi t, less any accumulated

losses brought forward, to a reserve account

(“legal reserve”), until this account reaches an

amount not less than 10% of the registered

authorised capital. The legal reserve is not

available for dividend distribution.

Other components of equity

Currency translation diff erences

The currency translation diff erences account

within equity comprises all foreign currency

diff erences arising from the translation of the

fi nancial statements of foreign operations.

Fair value changes in available-for-sale

investments

The fair value changes in available-for-sale

investments account within equity comprises

the cumulative net change in the fair value

of available-for-sale investments until the

investments are derecognised or impaired.

Reserve on business combination involving

entities under common control

The reserve represents the excess of the

book values of subsidiaries acquired in

transactions involving common control

entities over the costs of acquisitions. It is

non-distributable and will be retained until

the respective subsidiaries are sold or

otherwise disposed of.

26 Segment reporting

Segment information is presented in respect

of the Group’s business and geographic

segments. The primary format, business

segments, is based on the Group’s management

and internal reporting structure.

Inter-segment pricing is determined on

mutually agreed terms.

Segment results and assets include items

directly attributable to a segment as well as

those that can be allocated on a reasonable

basis.

Business segments

The Group comprises the following main

business segments:

Segment 1 Development of shopping centre

buildings, offi ce building and condominiums

for rent including provision of utility services,

operator of play land and water theme park

in the shopping centre buildings

Segment 2 Sales of food and beverage in the

shopping centres

Segment 3 Hotel business

Financial information by business segments

(in thousand Baht)

Segment 1 Segment 2 Segment 3 Total

2011 2010 2011 2010 2011 2010 2011 2010

Revenues 10,853,187 9,822,419 632,056 550,031 465,487 157,451 11,950,730 10,529,901

Segment results 3,802,958 3,435,542 90,708 79,512 273,617 90,372 4,167,283 3,605,426

Interest income 47,847 225,814

Other income 1,001,987 1,116,863

Share of profi ts from

investments accounted

for using the equity method 497,550 475,123

Administrative expenses (2,410,124) (2,099,033)

Losses from assets write-off - (775,000)

Profi t before fi nance cost and

income tax expenses 3,304,543 2,549,193

Finance cost (874,265) (688,290)

Income tax (354,479) (722,836)

Profi t for the year 2,075,799 1,138,067

Fixed assets by segment

(As at 31December) 54,432,255 43,908,619 124,595 68,402 2,086,708 1,880,985 56,643,558 45,858,006

Total assets by segment

(As at 31December) 61,639,857 51,990,502 201,347 80,076 2,217,961 1,798,823 64,059,165 53,869,401


27 Investment income

(in thousand Baht)


Note 2011 2010 2011 2010

Dividend income

Subsidiaries and funds 6 - - 531,845 1,407,487

Other related parties 6 - - 467,528 408,753

Other parties 110 90 110 90

110 90 999,483 1,816,330

Interest income

Subsidiaries and funds 6 - - 660,479 552,047

Other related parties 6 - - 4,687 197,644

Other parties 47,737 225,724 12,892 15,530

47,737 225,724 678,058 765,221

Total 47,847 225,814 1,677,541 2,581,551

28 Other income

(in thousand Baht)


2011 2010 2011 2010

Expenses claimed by tenants 279,482 209,520 53,576 60,771

Management fees 262,465 354,904 373,349 338,537

Reverse impairment 187,015 - 91,226 -

Others 273,025 552,439 203,302 423,190

Total 1,001,987 1,116,863 721,453 822,498

29 Expenses by nature

(in thousand Baht)


Note 2011 2010 2011 2010

Personal expenses 31 1,422,193 1,211,372 951,791 819,874

Depreciation / amortisation 2,876,772 2,356,239 574,574 511,063

Finance cost 32 874,266 688,290 905,660 786,905

Utilities expenses 2,209,200 2,118,661 960,375 965,330

Rental expenses 872,717 477,779 577,014 126,476

Loss from asset write-off 36 - 775,000 - -

Marketing 30 468,884 545,392 252,598 227,320

Others 2,343,804 2,314,065 692,148 900,282

Total expenses 11,067,836 10,486,798 4,914,160 4,337,250

30 Administrative expenses

(in thousand Baht)


2011 2010 2011 2010

Marketing 468,884 545,392 252,598 227,320

Personnel 1,088,251 949,068 849,752 738,331

Administrative 152,057 123,320 111,486 118,766

Others 700,932 481,252 286,606 249,581

Total 2,410,124 2,099,032 1,500,442 1,333,998


31 Employee benefi t expenses (in thousand Baht)


2011 2010 2011 2010

Management

Wages and salaries 57,679 58,782 57,679 58,782

Others 20,551 25,328 20,551 25,328

Total 78,230 84,110 78,230 84,110

Other employees

Wages and salaries 1,027,120 900,095 679,517 599,454

Contribution to defi ned contribution plans 23,552 20,122 19,699 16,924

Others 371,521 291,155 252,575 203,496

Total 1,422,193 1,211,372 951,791 819,874

The defined contribution plans comprise

provident funds established by the Group for

its employees. Membership to the funds is

on a voluntary basis. Contributions are made

monthly and separately by the employees

and the Group at rates ranging from 3% to 10%

of employees’ basic salaries. The provident

funds are registered with the Ministry of

Finance as juristic entities and are managed

by a licensed Fund Manager.

32 Finance costs (in thousand Baht)


Note 2011 2010 2011 2010

Interest expense:

- subsidiaries and related parties 6 - - 162,003 173,831

- fi nancial institutions 960,469 762,205 729,653 607,997

Fee

- related parties - 1 - 1

- fi nancial institutions 22,028 11,881 14,004 5,076

Total fi nance costs 982,497 774,087 905,660 786,905

Finance costs capitalised (108,231) (85,797) - -

874,266 688,290 905,660 786,905

Finance costs for properties under development for the years 2011 and 2010 have been capitalised at rates ranging from 3%-5%, representing

the weighted average interest rate of general purposes borrowings.

33 Income tax

(in thousand Baht)


Note 2011 2010 2011 2010

Current tax expense

Current year 857,509 992,374 246,379 459,966

857,509 992,374 246,379 459,966

Deferred tax expense

Movements in temporary diff erences (456,704) (269,538) (213,507) (133,045)

Diff erent from change tax rate (46,326) - (102,129) -

18 (503,030) (269,538) (315,636) (133,045)

Total 354,479 722,836 (69,257) 326,921

Reconciliation of eff ective tax rate


2011 2010

Tax rate Tax rate

(%) (in thousand Baht) (%) (in thousand Baht)


Total income tax expense 354,479 722,836

Profi t before total income tax expense 2,430,278 1,860,903

Income tax using the Thai corporation tax rate 30 729,083 30 558,271

Eff ect of diff erent tax rates in foreign jurisdictions - (8,814)

Income tax reduction - current - (15,000)

Income tax reduction - deferred (46,326) -

Income from Thai operations not subject to tax (375,154) (682,798)

Income from overseas operations not subject to tax - (10,773)

Expenses not deductible for tax purposes 932 881,950

Recognition of tax losses 45,944 -

Total 15 354,479 26 722,836



2011 2010

Tax rate Tax rate

(%) (in thousand Baht) (%) (in thousand Baht)


Total income tax expense (69,257) 326,921

Profi t before total income tax expense 1,214,478 3,074,873

Income tax using the Thai corporation tax rate 30 364,343 30 922,461

Income tax reduction - current - (15,000)

Income tax reduction - deferred (102,129) -

Income not subject to tax (332,730) (585,102)

Expenses not deductible for tax purposes 1,259 4,562

Total - (69,257) 20 326,921

Income tax reduction- current

Royal Decree No. 387 B.E. 2544 dated 5

September 2001 grants companies listed on

the Stock Exchange of Thailand a reduction

in the corporate income tax rate from 30% to

25% for taxable profi t not exceeding Baht 300

million for the fi ve consecutive accounting

periods beginning on or after enactment.

Listed companies that received income tax

reduction under this Royal Decree are also

eligible to continue the period of tax reduction

under Royal Decree No. 475 but not beyond

the 2010 accounting period ending on or after

31 December 2010.

Royal Decree No. 475 B.E. 2551 dated 6 August

2008 grants companies listed on the Stock

Exchange of Thailand a reduction in the

corporate income tax rate from 30% to 25%

for taxable profit not exceeding Baht 300

million for the three consecutive accounting

periods beginning on or after 1 January 2008.

Income tax reduction - deferred

On 11 October 2011, the Cabinet passed a

resolution regarding tax measures to increase

Thailand’s competitiveness and approved

the reduction of the corporate income tax

rate from 30% to 23% of net taxable profi t for

the accounting period 2012 which ends on

or after 31 December 2012 and to 20% of net

taxable profi t for the accounting period which

begins on or after 1 January 2013 and onwards.

In order to give eff ect to the above Cabinet

resolution, the Government has issued a Royal

Decree under the Revenue Code regarding the

Reduction and Exemption in Income Taxes

(No. 530) B.E. 2554 to reduce the corporate

income tax rate for the three accounting

periods 2012, 2013 and 2014; from 30% to 23%

for the accounting period 2012 which begins

on or after 1 January 2012 and to 20% for the

following two accounting periods 2013 and

2014 which begin on or after 1 January 2013

and 2014, respectively. It is understood that

the Government will proceed to amend the

law in order to maintain the corporate

income tax rate at not higher than 20% for

the accounting period 2015 which begins on

or after 1 January 2015 and onwards in order

to give full eff ect to the Cabinet resolution.

Such announcement on the reduction

of income tax rate has an impact on the

measurement of deferred tax assets and

deferred tax liabilities since Thai Accounting

Standard No. 12 Income Taxes paragraph 47

states that deferred tax assets and liabilities

shall be measured at the tax rates that are

expected to apply to the period when the

asset is realized or the liability is settled,

based on tax rates that have been enacted

or substantively enacted by the end of the

reporting period.

The Federation of Accounting Professions

has considered this matter and has resolved

that the substantively enacted tax rates which

should be applied in measuring deferred tax

assets and liabilities shall be the reduced

rates as approved by the Cabinet; i.e. 23%

shall be applied for the accounting period

2012 and 20% shall be applied for accounting

periods 2013 onwards.

34 Basic earnings per share

The calculations of basic earnings per share for the years ended 31 December 2011 and 2010 were based on the profi t for the years

attributable to equity holders of the Company and the number of ordinary shares outstanding during the year, calculated as follows:

(in thousand Baht/thousand shares)



Profi t attributable to equity holders

of the Company (basic) 2,058,123 1,124,866 1,283,735 2,747,952

Number of ordinary shares Outstanding 2,178,816 2,178,816 2,178,816 2,178,816

Basic earnings per share (Baht) 0.94 0.52 0.59 1.26

35 Dividends

At the Company’s annual general meeting

of the shareholders on 29 April 2011, the

shareholders approved the distribution of

dividend from 2010 operating results in the

amount of Baht 0.25 per share, totalling Baht

544.7 million, and was paid to the shareholders

in May 2011.

At the annual general meeting of the

shareholders of the Company on 28 April

2010, the payment of dividends was approved

at Baht 0.58 per share from 2009 operating

results. Total dividend payout amounted

to Baht 1,263.7 million, and was paid to the

shareholders in May 2010.

36 Impact from fi re damage as a result

of political demonstration

The Group has entered into long-term lease

agreements for land and premises of the

Central World Project in the name of the Thai

Business Fund 4, with the Crown Property

Bureau. The leased properties comprise:

> The Central World Shopping Complex

> The Offi ces at Central World

> Zen Department Store, the Company’s

long-term lessee

> Isetan Department Store, the Company’s

long-term lessee

> Parts of land that the Company has

subleased to the group of Central Plaza

Hotel Plc. to construct and operate Centara

Grand at Central World Hotel

A fi re at the Central World Project on 19 May

2010 caused damage to assets and parts of

the following buildings of the Central World

Project:

> Zen Department Store (parts of which are

the Group’s assets under long-term lease

to Zen Department Store)

> Central World Shopping Complex

As a result of the fi re, the Group needed to

close down the Central World Shopping

Complex and Zen Department Store from

April 2010. On 28 September 2010, the Group


opened for commercial purposes parts of

the Central World Shopping Complex. The

remaining damaged areas, comprising ZEN

Department Store and parts of the shopping

complex, remain closed and are undergoing

demolition and repair. Consequently, the

Group has not charged rent to tenants during

periods of closure.

As at 31 December 2010, the Group has

recorded losses from the write-off of

damaged properties in the consolidated

fi nancial statements for the year then ended

at the damaged properties’ aggregate net

book values of Baht 775 million.

The Group’s insurance policies comprise

(1) the Industrial All Risk Policy with sum

insured of Baht 13,224 million (2) the Business

Interruption Policy with sum insured of Baht

6,147 million and (3) the Terrorism Insurance

Policy with sum insured of Baht 3,500 million.

The management has already fi led claims

with its insurers seeking compensations

from all of the said insurance policies.

On 16 December 2011, the Group has made a

prosecution against insurance company as

a result of the fi re incident at Central World

shopping complex. The Group has claimed

for the indemnity from Industrial All Risks

policy at the amount of Baht 2,848.4 million

for the Group itself and/or The Bureau of the

Crown Property and also claimed for Baht

989.8 million from the Business Interruption

policy for the Group.

At 31 December 2011, the lawsuit is still

under the Civil Court’s consideration and

management believes that the Group will

receive full indemnity it has fi led from the

insurance company.

37 Leasing or sub-leasing properties

On 4 November 2009, The Company leased/

sub-leased parts of Central Plaza Pinklao

valuing at Baht 5,680 million to CPNRF

(the amount is inclusive of expenses arising

from additional units issuance and off ering

of approximately Baht 100 million which was

borne by the Company). As a consequence,

the Company recorded gain on lease under

fi nance lease for the year in the amounts of

Baht 3,206.9 million and Baht 3,851.3 million

in the 2009 consolidated and separate

statements of income, respectively. The

Company and SCB Asset Management, the

fund manager, have registered the property

leasehold right, which represents the

following assets:

> Certain part of a retail shopping complex,

and two offi ce buildings (the whole buildings),

including parking buildings as allotted by

the utilisable areas of the shopping complex

and the offi ce buildings invested by CPNRF.

> Ownership of utilities systems and assets

that relate to Central Plaza Pinklao Project;

and

> Land on which the shopping complex,

offi ce and parking buildings, surrounding

streets and entrances and exits of Central

Plaza Pinklao Project are located.

The Company, as the complex owner, agreed

to guarantee the net property income (before

leasing commission) generated from the

complex in 2010 to CPNRF in the amount

of Baht 629 million. The guarantee was

designed to ensure stable and continuous

cash flows to the fund during the year

2010 when Central Plaza Pinklao Shopping

Complex is refurbished and renovated (See

note 21).

38 Financial instruments

Financial risk management policies

The principal financial risks faced by the

Group are interest rate risk and credit risk.

The Group borrows at both fi xed and fl oating

rates of interest to fi nance its operations.

Credit risk arises from the risk in the

collectability of rental fees.

Capital management

The Board’s policy is to maintain a strong

capital base so as to maintain investors,

creditors and market confidence and to

sustain future development of the business.

The Board monitors the return on capital

which the Group defines as result from

operating activities divided by total

shareholders’ equity, excluding minority

interests, and also the level of dividends to

ordinary shareholders.

Risk management: Main sources of capital

of the Group are from equity, long-term

loans and local money and capital markets

through which the Group issues debentures

and transfer assets to property funds. The

Group abides by conservative capital structure

policies which consist of maintaining net

interest-bearing debt to equity ratio at

approximately 1.00, procuring capital with

appropriate and market-consistent cost of

capital and maintaining the level of fl oating

interest rate debts below that of the fi xed

interest rate to prevent interest rate

fl uctuation risk.

Interest rate risk

Interest rate risk is the risk that future

movements in market interest rates will

aff ect the results of the Group’s operations

and its cash fl ows because debt securities

and loans interest rates are mainly fi xed. The

Group is primarily exposed to interest rate

risk from its borrowings. The Group mitigates

this risk by ensuring that the majority of its

debt securities and borrowings are at fi xed

interest rates to manage exposure to

fluctuations in interest rates on specific

debt securities and borrowings.

Foreign currency risk

The Group is exposed to foreign currency

risk relating to. The Group primarily utilises

forward exchange contracts with maturities

of less than one year to hedge such fi nancial

assets and liabilities denominated in foreign

currencies.

Credit risks

The current policies established by the Group

to manage credit risk are:

> To collect an advance equivalent to 6

months rental from customers.

> To terminate rental contracts for tenants

whose rental fees are outstanding over 90

days.

Liquidity risks

The liquidity risk is the risk that the Group

will encounter diffi culty in raising funds to

meet commitments associated with fi nancial

instruments.

The objective of liquidity risk management

of the Group is to have appropriate and

sufficient capital for cash outflow for

investment at present and in the future and

to be able to invest such capital to gain

appropriate returns under investment

policies of the Group.

Determination of fair values

A number of the Group’s accounting policies

and disclosures require the determination

of fair value, for both financial and non-

fi nancial assets and liabilities. The fair value

is the amount for which an asset could be

exchanged, or a liability settled, between

knowledgeable, willing parties in an arm’s

length transaction. Fair values have been

determined for measurement and/or

disclosure purposes based on the following

methods. When applicable, further information

about the assumptions made in determining

fair values is disclosed in the notes specifi c

to that asset or liability.

The fair value of trade and other short-term

receivables is taken to approximate the

carrying value.

The fair value of investments in equity and

debt securities, which are held for trading,

held to maturity and available for sales, is

determined by reference to their quoted bid

price at the reporting date. The fair value of

held-to-maturity investments is determined

for disclosure purposes only.

The fair value of interest rate swaps is based

on broker quotes. Those quotes are tested

for reasonableness by discounting estimated

future cash fl ows based on the terms and

maturity of each contract and using market

interest rates for a similar instrument at the

measurement date.

The fair value of forward exchange contracts

is based on their listed market price, if

available. If a listed market price is not

available, then fair value is estimated by

discounting the difference between the

contractual forward price and the current

forward price at the reporting date for the

residual maturity of the contract using a

risk-free interest rate (based on government

bonds).

The carrying amounts of the fi nancial assets

and financial liabilities approximate their

fair values. Such assets and liabilities include

cash and cash equivalents, investments, trade

accounts receivables and payables, other

receivables and payables, loans to subsidiaries,

short-term borrowings and fl oating interest

rate long-term borrowings. Information on

the fair values of borrowings is included in

note 20.


39 Commitments with non-related parties

(in million Baht)


2011 2010 2011 2010

Capital commitments

Contracted but not provided for Vehicle 5 5 5 5

Buildings and facilities systems 3,540 2,216 59 869

Total 3,545 2,221 64 874

Non-cancellable operating lease commitments

Within one year 339 307 284 252

After one year but within fi ve years 2,148 1,802 1,898 1,569

After fi ve years 14,893 13,520 13,916 12,489

Total 17,380 15,629 16,098 14,310

Other commitments

Bank guarantees 273 442 306 268

(a) The Group entered into forward foreign exchange contracts to manage the risk arising from foreign exchange. As at 31 December 2011,

the details were as follows:

(in million Baht)

2011

Thai Baht United States Total Currency Dollars Currency

Forward exchange contract

- Bought contracts - 711 711

- Sold contracts (741) - (741)

(741) 711 (30)

(b) As at 31 December 2011, the Company had

various interest rate swap agreements with

various banks to reduce the risk of fl uctuation

in interest rates covering Thai Baht in the

total amount of Baht 3,000 million divided

as follows:

> An amount of Baht 1,500 million for 2.5 years,

due in June 2014

> An amount of Baht 1,500 million for 3 years,

due in September 2014

For the duration of the agreements, the

Company is committed to receive payments

from or make payments to the other party

whenever the interest rates vary from the

agreed rates based on the terms and conditions

stipulated in the agreements. However, the

Company is still liable for commitments

with the lender if the counterparty is unable

to comply with the terms and conditions of

such agreements.

(c) A subsidiary has signed a hotel manage-

ment agreement with a third party whereby the

subsidiary agrees to pay annual management

fee at the rate of 2% of the hotel’s operating

income and additional compensation as a

percentage of gross operating profi t as follows:

> 7% from the first to the second year of

operation

> 7.5% from the third to the fourth year of

operation

> 8% from the fi fth year of operation onwards

(d) The Group entered into a land lease

agreement with a third party. The land was

leased for the construction of a shopping

centre for lease. The lease agreement was

for a period of 30 years ending in December

2041. Under the conditions of the agreement,

the Group paid advance rental and has to pay

monthly rental. The rental will be increased

every three years at the rate of 10% of the lates

t month rental.

(e) The Group entered into a land lease

agreement with a third party. The land was

leased for the construction of a building for

lease. The lease agreement was for a period

of 30 years ending in May 2027. Under the

conditions of the agreement, the Group paid

advance rental and has to pay monthly rental.

The rental will be increased every fi ve years

at the rate of 10% of the latest month rental.

(f) The Group entered into a land lease

agreement with a local company. Land was

leased for the construction of a shopping

centre for lease. The lease agreement was

for a period of 30 years ending in June 2030.

Under the conditions of the agreement, the

Group paid advance rental and has to pay a

monthly rental. The rental will be increased

every three years at the rate of 15% of the

latest rental. The agreement can be renewed

for the same period as the lessor is able to

renew with the landlord. The lessor would

obtain the rights to the buildings and

improvements thereon at the lease expiration

date. During 2006, the Group has not paid

the lease payments under this agreement

since the project has been temporarily

suspended. The lease term and conditions

are under consideration to be amended by

both parties. However, during the year 2007 the

Group entered into an agreement to cancel

the lease, as a result of which the Group had

to pay a compensation fee to the lessor of

Baht 377 million.

On 29 June 2007, the Group entered into two

land lease agreements with a local company.


Group paid advance rental. One agreement

charges no monthly lease fee for the period

of 3 years, from 1 July 2007 to 30 June 2010.

The other agreement is a land lease agreement

for the period of 30 years from 1 July 2010

to 30 June 2040. Under the conditions of

the latter agreement, the Group has to pay

the land rental charge of Baht 700,000 per

month which will be increased at the rate of

15%, every three years from 1 July 2010. This

agreement can be renewed for another

10-year period (till 30 June 2050) with monthly

rental charge at the same rate as at 30 June

2040 for the whole additional 10 years.

The Group uses these leasehold rights as

collateral for Bank aval on the promissory

notes, which are also guaranteed by the

Company. As at 31 December 2009, the

Company has already paid the whole amount

of such promissory notes.

(g) The Group entered into three lease

agreements with third parties for the

construction of shop buildings for lease and

shophouses. Two land lease agreements were

for a period of 30 years ending in August

2025 and in June 2030, respectively. Another


agreement is for a lease of shophouses for a

period of 26 years ending in July 2021. Under

the conditions of the agreements, the Group

has to pay advanced rental and guarantee

for rights and guarantee for leasehold rights.

In addition, the Group has to pay a monthly

rental which will be revised every fi ve years.

The Group received a refundable guarantee

deposit amounting to Baht 20 million in 1997

and will receive the remaining balance of the

refundable guarantee deposits amounting to

Baht 298.6 million from the 21st year of the

lease to the end of the 30 years lease term.

The land lease agreements can be renewed

for a period of not less than 15 years through

a one year advance written notification

before expiration in which the terms will be

renegotiated upon renewal. The lessor will

obtain the ownership rights of buildings and

improvements thereon at the lease expiration

date. Upon the expiration of the shophouse

lease, the lessor will give the Group a priority

in renewing the lease agreement.

The Group entered into three land lease

agreements with the third parties to construct

shop buildings for rent. The lease agreement

covered a 30-year period ending in 2038.

Under the conditions of the agreement,

the Group had to pay advanced rental. In

addition, the Group has to pay a rental

annually. The rental will be increased every

3 years at the rate of 12%. The lease can be

renewed for another 10-year period 2 years

before the agreement terminated with the

new rate and compensation agreed.

(h) In 2003, the Group entered into a land

and building lease agreement as lessee

with The Bureau of the Crown Property. The

lease agreement was for a period of 30 years

ending in December 2032 during which the

Group has to pay a monthly rental. Under the

conditions of the agreement, the agreement

can be renewed for another 30-year period in

which the terms have been agreed. The lessor

obtains the ownership rights of building and

improvements on the fi rst day of the lease.

In 2007, the Group entered into two MOU

comprising of the cancellation of certain land

lease under the principal agreement with

The Bureau of the Crown Property and

appointment of its related company as the

new lessee under conditions stipulated in a

new agreement between the lessor and the

related company for a period of 25 years

commencing 1 January 2007 to 22 December

2032. However, the Group has commitment

to pay rental fee to The Bureau of the Crown

Property after the termination of the lease

period.

On 19 August 2011 the Group entered into a

land and building lease agreement as lessee

in addition to principle agreement with The

Bureau of the Crown Property. The lease

agreement was for a period of 21 years and

7 months ending in December 2032. Under the

conditions of the agreement the Group has

to pay advance yearly rental. The agreement

can be renewed for another 30-year period in

which the terms have been adue for 3 years

in advance faced on the rates and benefi ts,

according to a new agreement. The lessor

pledges to provide prior benefits to the

company to renew the lease.

(i) In 2005, the Group entered into a land

lease agreement with a local company for the

construction of shop buildings and parking.

The land lease agreement was for a period

of 28 years 10 months ending in September

2034. Under the conditions of the agreement,

the Group has to pay a monthly rental from

September 2006. The rental will be increased

every fi ve years at the rate of 5% of the latest

month rental. The lease agreements can be

renewed six months in advance by written

notifi cation before expiration in which the

terms will be renegotiated upon renewal.

Subsequently, in 2009, the Group entered into

an MOU to amend land lease agreement under

the same period and condition as it may be

surrendered to the government for the mass

rapid transit.

On 9 August 2007, the Group entered into

a land and building lease agreement with a

third party. The lease agreement was for the

period of 30 years ending in 31 August 2037.


Group has to pay a yearly rental. The rental

will be increased every fi ve years at the rate

of 35% of the latest month rental. The lease

agreement can be renewed by notifi cation

one year in advance.

40 Contingent liabilities

Guarantee

As at 31 December 2011, the Company entered

into a loan guarantee agreement for

subsidiaries totalling Baht 4,668 million

(2010: Baht 3,651 million).

Litigation

The signifi cant litigation of the Company and

the progress of litigation up to 31 December

2011 are as follows:

(a) In 1996, a local company fi led a case with

the court against the Company for breach

of rental agreement amounting to Baht 83.4

million. The Company fi led a counter-claim

with the court against that company for

damages of Baht 2.5 million. In October 2001,

the First Court gave its verdict in favour of

the Company. However, in September 2004,

the Appeal Court gave verdict in favour of a

counter party. At present, the case is being

reviewed by Supreme Court. Consequently,

the Supreme Court gave verdict in favour of

the Company.

(b) In 2003, an individual fi led a case with the

court against the Company for damages

caused by the Company’s construction

project amounting to Baht 52.0 million. The

First Court and the Appeal Court rendered its

verdict in favour of the Company. At present,

the case is being reviewed by the Supreme

Court. Consequently, the Supreme Court gave

verdict in favour of the Company.

(c) In 2003, individuals fi led a case with the

court against the Company for damages

caused by the Company’s construction project

amounting to Baht 12.9 million. The First Court

rendered its verdict in favour of the Company.

At present, the case is being reviewed by the

Appeal Court. Consequently, the Appeal Court

gave verdict in favour of the Company.

41 Impact of severe fl ooding

in Thailand

The Group’s operation has been slightly

affected by unusually severe flooding in

parts of Thailand. Certain shopping centers

have stopped operations since 26 October

2011. The Group has assigned workers to

prevent the fl ood and minimises, the eff ects

of the fl ooding on the Group’s assets and

operations. As at 31 December 2011, such

shopping centers have been reopened, the

Group has recorded the effect arising

therefrom amounting to Baht 26.5 million

and Baht 20.6 million in the consolidated

and separate statement of comprehensive

income, respectively.

42 Event after the reporting period

At the Board of Directors meeting on 24

February 2012 passed signifi cant resolutions

as follows:

> approving the distribution of dividend from

2011 operating results in the amount of Baht

0.37 per share (totalling Baht 806.2 million).

> approving the issuance of unsubordinated

secured and/or unsecured debentures with a

tenure of not over 10 years of not exceeding

Baht 10,000 million to support the investment

plan of the Company.

> approving the issuance of short term

debenture and/or bill of exchange in the

amount not exceeding Baht 4,000 million

with the maturity not exceeding 270 days.

43 Thai Financial Reporting Standards

(TFRS) not yet adopted

The Group has not adopted the following new

and revised TFRS that have been issued as of

the reporting date but are not yet eff ective.

The new and revised TFRS are anticipated to

become eff ective for annual fi nancial periods

beginning on or after 1 January in the year

indicated in the following table.

Year

TFRS Topic eff ective

TAS 21 The Eff ects of 2013

(revised Changes in Foreign

2009) Exchange Rates

Management has determined that the

functional currency of the Company is Thai

Baht. Accordingly, the adoption of TAS 21

from 1 January 2013 is not expected to have a

signifi cant impact on the Company’s reported

assets, liabilities or retained earnings.


44 Reclassifi cation of accounts

Certain accounts in the 2010 fi nancial statements have been reclassifi ed to conform to the presentation in the 2011 fi nancial statements.

These reclassifi cations have principally been made following changes in accounting policies consequent to the adoption of new and revised

TFRS reporting as disclosed in note 3. Other signifi cant reclassifi cations were as follows.

(in thousand Baht)

2010

Consolidated fi nancial statements Separate fi nancial statements

Before After Before After reclass. Reclass. reclass. reclass. Reclass. reclass.

Statement of fi nancial position

Current assets

Other accounts receivable - 1,479,163 1,479,163 - 1,295,896 1,295,896

Other current assets 1,479,163 (1,479,163) - 1,295,896 (1,295,896) -

Non-current assets

Deferred tax asset 1,091,204 9,778 1,100,982 - 504,174 504,174

Current liabilities

Other accounts payable - (2,656,779) (2,656,779) - (946,322) (946,322)

Other current liabilities (2,656,779) 2,656,779 - (946,322) 946,322 -

Non-current liabilities

Deferred tax liabilities (1,677,091) (9,778) (1,686,869) (546,271) (504,174) (1,050,455)

- -

Statement of comprehensive income

Expenses

Administrative expenses 2,014,923 84,109 2,099,032 1,249,889 84,109 1,333,998

Management benefi t

expenses 84,109 (84,109) - 84,109 (84,109) -

- -

The reclassifi cations have been made in the opinion of Group’s management, the new classifi cation is more appropriate to the Group’s

business and to comply with the classifi cation set out in the Pronouncement of the Department of Business Development Re: Determination

of items in the fi nancial statements B.E. 2554 dated 28 September 2011.

1. Audit fee

In 2011, Audit fee of the Company and its

subsidiaries had been paid for audit firm

that the auditor work for amounted to Baht

5,230,000.

2. Other service fee

- None -

AUDITOR’S FEE


02 Mr. Suthichai Chirathivat

Age 71 years Percentage of Shareholding in the Company 1.92%

> Chairman

Education> Diploma in Civil Engineering,

Kingston College of Technology, U.K.

> Honorary Doctorate of Business

Administration Program,

Chiangrai Rajabhat University

Experience> Vice Chairman, Chief Financial Offi cer,

Central Group of Companies Co., Ltd.

> Assistant General Manager,

Central Department Store Co.,Ltd

> Manager,

Central Department Store-Silom Branch

> Assistant Manager,

Central Department Store-Silom Branch

Other Current Positions> Chairman of Supervisory Board,


> Vice Chairman, Central Plaza Hotel Plc.

Completed Program fromThai Institute of Directors (IOD)> 2006 - Director Accreditation Program

(DAP)

> 2000 - Role of Chairman Program

(RCP)

01 Mr. Vanchai Chirathivat

Age 84 years Percentage of Shareholding in the Company : None

> Honorary Chairman

Education> Honorary Doctor of Philosophy,

Psychological, Ramkamhaeng University

> Honorary Doctor of Business

Administration, Khon Kaen University

Other Current Positions> Honorary Chairman,

Central Plaza Hotel Plc.

> Honorary Chairman, Malee Sampran Plc.

> Honorary Chairman, Post Publishing Plc.

> Vice Chairman, Indara Insurance Plc.

> Chairman, Central Group of Companies

Co., Ltd.

> Chairman, Central Department Store

Co.,Ltd.

- Chairman, Central Trading Co.,Ltd.

- Director, Board of Commercial

Investment Thailand - China

> Permanent Honorary President,

The Institute of Thai Hainan

> Permanent Honorary President,

Ethics and Morals Foundation

> Vice Chairman, Thainfar Hospital

Foundation

03 Mr. Paitoon Taveebhol


> Independent Director > Chairman of Audit Committee > Chairman of Risk Management Committee

Education> B.A. (Accounting),

Ramkhamhaeng University

> MBA, Kasetsart University

> Certifi cate in Auditing,

Thammasat University

Experience> Managing Director,

Arthur Andersen Business Advisory Ltd.

> Director, Executive Director,

SGV-Na Thalang Co.,Ltd.

> 2003-2005 Managing Director,

BT Business Consulting Co.,Ltd.

> 1998-2000 Vice President, Council

Member, The Institute of Internal

Auditors of Thailand

> 1991-2005 President, Secretary General

The ASEAN Federation of Accountants

> 1991-2003 Vice President, Council

Member, The Institute of Certifi ed

Accountants and Auditors of Thailand

Other Current Positions> Independent Director, Chairman of

the Nomination and Remuneration

Committee, Audit and CG Committee

Member, Somboon Advance Technology

Plc.

MANAGEMENT BIOGRAPHY

04 Mr. Chackchai Panichapat


> Independent Director > Audit Committee Member > Chairman of Nomination and Remuneration Committee

Education> B.E. (Electrical Engineering),

Chulalongkorn University

> M.E. (Electrical Engineering),

University of Texas, U.S.A.

> National Defence College, The Joint

State-Private Sectors Course, Class 1

Experience> Deputy Secretary General of the Board

of Investment, Thailand Board of

Investment

Other Current Positions> Director, Executive Director,

Amata Corporation Plc.

> Independent Director, Advisory Board

Member, Saha Union Plc.

> Independent Director, Chairman of

the Audit Committee, and Member


Committee, City Sports and Recreation

Plc.

> Independent Director, Chairman of

Audit Committee, Member of

Corporate Governance Committee,

Big C Super Center Plc.

> Audit, Following and Evaluation

Committee, Walailak University

> Board Member, Mater Dei Institute

> President, Mater Dei Institute Parent and

Teacher Association

> Vice Chairman, Mater Dei Institute

Foundation

Completed Program fromThai Institute of Directors (IOD)> 2010 - Monitoring the Internal Audit

Function (MIA)

- Monitoring the System of Internal

Control and Risk Management

(MIR)

- Monitoring the Quality of

Financial Reporting (MFR)

- Role of the Compensation

Committee (RCC)

> 2009 - Monitoring Fraud Risk

Management (MFM)

> 2008 - Chartered Director Class (R-CDC)

> 2005 - Audit Committee Program (ACP)

- Role of Chairman Program (RCP)

> 2003 - Director Certifi cation Program

(DCP)

- Director Accreditation Program

(DAP)

Other Programs / Seminars> 2011 - Seminar “Financial Reporting

Standard for Non-Publicly

Accountable Entities”

- Seminar “Corruption Prevention

and Reporting under NACC’s Law”

- Seminar “Audit Committee

Forum”

> Independent Director, Member of

the Audit Committee and Chairman


Committee, Kang Yong Electric Plc.

> Chairman, Magnecomp Precision

Technology Plc.

> Chairman, Precipart Co., Ltd.

> Chairman, Amata Water Co., Ltd.

> Chairman, Amata (Vietnam) Joint Stock

Company

> Director, Amata Hong Kong Ltd.

> Director, San Miguel Beer (Thailand)

Co., Ltd.

> Director, San Miguel Marketing

(Thailand) Co., Ltd.

> Director, Thai San Miguel Liquor Co., Ltd.

Completed Program fromThai Institute of Directors (IOD)> 2009 - Audit Committee Program (ACP)

> 2007 - Role of the Compensation

Committee (RCC)


(DCP)

> 2005 - Finance for Non-Finance

Directors (FND)

> 2003 - Director Accreditation Program

(DAP)


Directors (FND)

> 2004 - Directors Accreditation Program

(DAP)

- Seminar : Directors Forum

3/2004

- Seminar : Directors Forum

2/2004

Other Programs / Seminars> 2011 - Seminar “Committee on the Great

Flood Crisis.”

06 Mr. Karun Kittisataporn


> Independent Director > Audit Committee Member > Nomination and Remuneration Committee Member

Education> B.C.A. (Economics) Victoria University

of Wellington, New Zealand

> M.A. (International Trade), Syracuse

University, U.S.A.

> Diploma, GATT Commercial Policy

Course, Geneva, Switzerland



Experience> 2001-2007 Permanent Secretary,

Ministry of Commerce

> 2003-2008 Director, Bank of Thailand

> 2006-2008 Member, The National

Legislative Assembly Thailand

> 2008-2011 Director, Public Sector

Development Commission

> 2009-2011 Commission Member,

Securities and Exchange Commission

Other Current Positions> Independent Director, Chairman

of Nomination and Remuneration

Committee, Bank of Ayudhya Plc.

> Independent Director, Audit Committee

Member, Sahamit Machinery Plc.

> Independent Director, Nomination and

Remuneration Committee Member,

Khon Kaen Sugar Industry Plc.

> Director, Insurance Commission

> Member, Council of State

> Chairman, Support Arts and Crafts

International Centre of Thailand (Public

Organization)

Completed Program fromThai Institute of Directors (IOD)> 2011 - Financial Institutions Governance

Program (FGP)

- Monitoring the Quality of


- Director Lunchon Briefi ng (DLB)


- Financial Statements for Directors

(FSD)

> 2008 - Role of the Compensation

Committee (RCC)


(DCP)

05 Mrs. Sunandha Tulayadhan


> Independent Director > Audit Committee Member > Nomination and Remuneration Committee Member

Education> B.A. (Liberal Arts),

College of New Rochelle, U.S.A.

Experience> Chairman, Ogilvy & Mather Group,

Thailand and Vietnam

> Regional Executive Board Member,

Ogilvy & Mather Asia Pacifi c

> Director, Ogilvy & Mather Worldwide

Board

> Honorary Chairman, WPP Group,

Thailand and Vietnam

Completed Program fromThai Institute of Directors (IOD)> 2011 - Seminar “How New Foreign

Bribery Laws Companies in

Thailand”


Management (MFM)

> 2007 - Seminar “Audit Committee :

Experience, Problems and Good

Practices”


- Finance for Non-Finance

07 Mr. Kanchit Bunajinda


> Director > Nomination and Remuneration Committee Member > Risk Management Committee Member

Education> B.E. (Civil Engineering),


> MBA (Finance and International

Business) Sasin Graduate Institute of

Business Administration,

Chulalongkorn, University

> Kellogg Graduate School Management,

Northwestern University, in an exchange

program of Sasin Graduate Institute of

Business Administration, Chulalongkorn

University

Experience> Senior Vice President, Heading

the Financial Institutions group and

the Mergers and Acquisition practice,

Merrill Lynch Phatra Co.,Ltd.

(Currently- Phatra Securities Plc.)

Other Current Positions> Director, Private Equity (Thailand)

Co.,Ltd. (An affi liate of Lombard

Investment, Inc.)

> Audit Committee Member,

True Visions Plc.

> Director, Pruksa Real Estate Plc.

> Director, Central Plaza Hotel Plc.

> Director, Robinson Department Store Plc.

> Alternate Director, Asian Corporate

Governance Association Limited,

Hong Kong

Completed Program fromThai Institute of Directors (IOD)> 2009 - Director Luncheon Briefi ng (DLB)

- Monitoring of the Quality of


- Monitoring the Internal Audit

Function (MIA)

- Monitoring the System of Internal

Control and Risk Management

(MIR)



(DAP)


(DCP)

08 Mr. Suthikiati Chirathivat


> Director

Education> Diploma in Mechanical Engineering,

South West Essex Technical College, U.K.

> B.A. (Political Science),


> M.A. (Political Science),


> Honorary Doctorate of Philosophy

in Mass Communications,




> National Defence College, The Modern

Management, Class 1

Experience> Assistant Manager,

Central Trading Co., Ltd.

> Assistant General Manager,

Central Department Store Co., Ltd.

> The Founder and Head of Thai Retailers

Association, Thai Retailers Association

> Advisor to The Minister of Tourism and

Sports, Ministry of Tourism and Sports

> Director, Assumption Association

Other Current Positions> Chairman, Central Plaza Hotel Plc.

> Director, Chairman Executive

Committee, Post Publishing Plc.

> Vice Chairman of Supervisory Board,


> Director, Thai Tourism Industry

Association


(DAP)


09 Mr. Suthichart Chirathivat


> Director

Education> B.A. (Accounting), St. Joseph’s College.

U.S.A.



Experience> President and Chief Executive Offi cer,

Central Retail Corporation Ltd.

> President, Thai Retailers Association

> Chairman Committee of Retail Business,

Thai Chamber of Commerce

> Chairman, Big C Super Center Plc.

> Advisor, Board of Trade of Thailand

> Director, Treasurer, Foundation for

Environment Preservation

Other Current Positions> Director, Central Plaza Hotel Plc.

> Director of Supervisory Board,


> Director, The Vintage Club Co.,Ltd.

> Director, Tiang Chirathivat Foundation


(DAP)

> 2003 - Finance for Non-Finance

Directors (FND)

- Board and CEO Assessment

> 2000 - Role of Chairman Program

(RCP)

10 Mr. Sudhisak Chirathivat


> Director > Advisory of Nomination and Remuneration Committee

Education> B.A. (Mathematic), St. John Fisher

College, U.S.A.

Experience> President, Central Marketing Group

> Managing Director,

Central Garment Factory Co., Ltd.

> Managing Director,

Prin Intertrade Co., Ltd.

Other Current Positions> Chairman, Robinson Department Store

Plc.


> Director of Supervisory Board,


> Director, Central Garment Factory

Co., Ltd.

> Director, Harng Chiangmai

Department Store Ltd.

> Director, Central Trading Co., Ltd.


(DAP)

- Director Certifi cation Program

(DCP)

11 Mr. Sudhitham Chirathivat


> Director > Advisory of Nomination and Remuneration Committee

Education> B.A. (Electrical Engineering), University

of Maryland (College Park), U.S.A.

> MBA (Operations Research), Iona

University, U.S.A.



Experience> Director, The Thai Chamber of Commerce

> President, Rotary Club of Bangkhen

> Chairman, Coff ee Partners Co.,Ltd.

(Starbucks-Thailand)

> President and Founder, Thai Shopping

Center Association

> 1990-2002 Managing Director and

Chief Executive Offi cer, Central Pattana

Plc.

> Advisory, The Ministry of Commerce

> 1980-1992 Executive Vice President /

President - Store Planning, Marketing,

and Business Development /

Vice President - Marketing, and

Merchandising, Central Department

Store Co., Ltd

Other Current Positions> Vice Chairman,

Robinson Department Store Plc.


> Director, Big C Super Center Plc.

> Independent Director, Jasmine

International Public Company Limited

> Executive Chairman, Central Group

of Companies Co., Ltd.

> Director, Central Holding Co., Ltd.

> Director, The Vintage Club Co., Ltd.

> Member, The National Legislative

Assembly Thailand

Completed Program fromThai Institute of Directors (IOD)> 2003 - Director Certifi cation Program

(DCP)

12 Mr. Prin Chirathivat


> Director > Advisory of Nomination and Remuneration Committee > Risk Management Committee Member

Education> B.A. (Accounting) Skidmore College,

U.S.A.

> MBA (Business Management),

Sasin Graduate Institute of Business

Administration, Chulalongkorn

University

> National Defense College,

The Joint State-Private Sectors Course,

Class 22

Experience> 2002-2005 Director, Dhanamitr

Factoring Plc.

> 1999-2006 Director, Indara Insurance

Plc.

> 1998-2004 Executive Director, Interlife

John Hancock Assurance Plc.

> 1995-2007 Director, General Card

Service Limited

> 1990-2002 Executive Director,


> 1988-1989 Investment Banking,

Thanachart Securities Plc.

Other Current Positions> Chairman of Audit Committee,

Bualuang Securities Plc.


> Director, Robinson Department Store Plc.

> Director, Malee Sampran Plc.

> Executive Director & Chief Financial

Offi cer, Central Group of Companies

Co., Ltd.

> Director, Executive Director,

Central Retail Corporation Ltd.

> Advisor, Marketing For Alternative

Investment (MAI)

> Steering Support Committee,

Chiangrai Rajabhat University

Completed Program fromThai Institute of Directors (IOD)> 2010 - Advanced Audit Committee

Program


Management (MFM)

- Monitoring of the Quality of


> 2007 - Monitoring the Internal Audit

Function (MIA)

- Monitoring the System of

Internal Control and Risk

Management (MIR)

> 2006 - Chief Financial Offi cer


(DAP)

- Audit Committee Program (ACP)

- Role of Chairman Program (RCP)


(DCP)

13 Mr. Kobchai Chirathivat


> Director > President & Chief Executive Offi cer > Risk Management Committee Member

Education> LL.B. (Law), Chulalongkorn University

> M.A. (Political Science), University of

Norte Dame, Indiana, U.S.A.


> MBA, University of Chicago,

Graduate School of Business, U.S.A.

> National Defence College,

The Joint State-Private Sectors Course,

Class 21

Experience> Chief Operating Offi cer and



> Senior Vice President - Business

Development, Central Pattana Plc.

> Director-Property Management,


> Deputy Managing Director,


> Marketing Manager, Central Trading

Co., Ltd.

> Assistant Manager, Central Trading

Co., Ltd.

Other Current Positions> Executive Director,


> Director, Sakura Restaurant Co., Ltd.

> Director, Central Advance System

Co., Ltd.

> Director, Genesis Corporation Co., Ltd.

Completed Program fromThai Institute of Directors (IOD)> 2001 - Director Certifi cation Program

(DCP)

14 Mr. Sudthidej Chirathivat


> Senior Executive Vice President

Education> B.A. (Business Management),

Prince George College, U.S.A.

Experience> Executive Vice President - Business

Development and Project Construction,


> Vice President - Leasing,


> Manager - Leasing, Bangna

Central Property Co., Ltd.

> Vice President - Leasing and Marketing,


> Vice President, Food Park Co., Ltd.

> 2002-2004 Director,


15 Mr. Naris Cheyklin


> Senior Executive Vice President, Finance, Accounting and Property Management > Risk Management Committee Member

Education> B.A. (Accounting),


> M.A. (Accounting),


Experience> Director, Vice President, Thai Wah Plc.

> Group Financial Controller,

Tanayong Plc.

> Computer Audit Supervisor,

SGV Na ThaLang Co., Ltd.

> 1996-1998 Senior Vice President,

Siam City Bank Plc.

> 1996-1998 Director, Executive Director,

Siam City Insurance Co., Ltd.

16 Ms. Wallaya Chirathivat


> Senior Executive Vice President, Business Development and Project Construction

Education> B.A. (Business Management),

University of California, Los Angeles

(UCLA), U.S.A.

> MBA, University of Hartford, U.S.A.

> Advance Management Program -

Executive Course, Harvard Business

School, U.S.A.

Experience> 1998-2004 Executive Vice President,

Central Retail Corporation Co., Ltd.

> 1996-1998 Co-Chief Executive Offi cer,

Tops Supermarket

> 1988-1996 Managing Director,

Central Supermarket

> 1985-1988 Vice President,


17 Mr. Suthipak Chirathivat


> Executive Vice President, Offi ce of the President

Education> Mini MBA (Property), Faculty of

Architecture, Chulalongkorn University

> Mini MBA, Faculty of Commerce and

Accountancy, Chulalongkorn University

> Real Estate Investment, Sasin Graduate

Institute of Business Administration,


> Executive MBA, Sasin Graduate Institute

of Business Administration,


Experience> Executive Vice President - Leasing,


> Executive Vice President - Business

Development, Central Pattana Plc.

> Executive Vice President - Marketing,


> Vice President - Business Development,


> Senior Leasing and Marketing Manager,


> Executive Vice President,

Thai International Fast - Food Co., Ltd.

> Executive Vice President,

Central Garment Factory Co., Ltd.

> Marketing Manager, Central Garment

Factory Co., Ltd.

18 Mr. Terachart Numanit


> Executive Vice President, Project Construction

Education> BSCE, Polytechnic University, U.S.A.

> Certifi cate Program: Executive

Financial Management Class 11,

Faculty of Economics,


Experience> Chief Estimate, John Holland (Thailand)

> Project Manager, New York City,

Transit Authority, U.S.A.

> Engineer, Project Parsons Brinckerhoff ,

New York City, U.S.A.

> Special Project Manager, Philip Holzman

(Thailand)

> 2001-2003 Project Director, Itochu

(Thailand) Co., Ltd.

> 1997-2001 Special Project Director,

K-Tech Construction and Engineering

Co., Ltd.

19 Ph.D. Nattakit Tangpoonsinthana


> Executive Vice President, Marketing

Education> B.A. (Communication Arts),


> M.A.(Communication), The University of

North Texus, U.S.A.

> MBA (Marketing),The University of North

Texas, U.S.A.

> Ph.D.Communication (Broadcasting

Management), Chulalongkorn University

Experience> Advisor to the Ministry of Science and

Technology, The Ministry of Science and

Technology

> 2004-2006 Chief Marketing Offi cer -

Strategic Marketing Division,

Thai Samsung Electronics Co., Ltd.

Other Current Positions> Visiting Lecturer-Mass Communication

The Faculty of Communication Arts,



20 Mrs. Narttaya Chirathivat


> Executive Vice President, Leasing

Education> B.A. (Economic), University of Hartford,

U.S.A.

> MBA, University of Hartford, France

Experience> 1995-2009 Senior Vice President -

Merchandising, Robinson Department

Store Plc.

> 1992-1995 Director - Softline

Merchandising, Big C Super Center Plc.

> 1990-1992 General Manager,

Central Retail Logistic Co., Ltd.

> 1988-1990 Director,


> 1986-1988 Manager,

J & S Import Ltd., Part.

21 Mrs. Panida Sooksridakul


> Acting Executive Vice President, Property Management

Education> B.A (Political Science),


> M.A (Political Science),


Experience> 2006 - 2011 Senior Vice President -

Property Development and Management,


> 1995 - 2005 Vice President -

Property Management,


CentralPlaza Grand Rama 9


Company Address Nature of Business Registered Percentage of

Capital Shareholding

1 Central Realty Services Co.,Ltd. 999/9 Rama I Rd., Servicing of Shopping 1,000,000 99.99% Patumwan, BKK 10330 Center Facilities Tel. +66(0) 2667-5555

2 Central Food Avenue Co.,Ltd. 1697 Phaholyothin Rd., Restaurant operations 5,000,000 99.99% Chatuchak, Chatuchak, BKK 10900 and servicing of shopping Tel. +66(0) 2793-6000 complex food center

3 Lang Suan Realty Co.,Ltd. 95/3 Lang suan Rd., Lumpini, Residential condominium 1,000,000,000 99.99% Patumwan, BKK 10330 and shop space for rent Tel. +66(0) 2652-2277

4 Central Pattana Rama 2 Co.,Ltd. 160 Rama 2 Rd.,Samaedum, Shopping Center: 1,500,000,000 99.99% Bangkhuntian, BKK 10150 CentralPlaza Rama 2 Tel. +66(0) 2866-4300

5 Central Pattana Chiangmai Co.,Ltd. 2 Mahidol Rd., 252-252/1 Wualai Rd., Shopping Center: 1,000,000,000 99.99% Haiya, Muang, Chiangmai 50100 Central Plaza Tel. +66(0) 5399-9199 Chiangmai Airport

6 Central Pattana Rattanathibet 68/100, 68/919 M.8 Rattanathibet Rd., Shopping Center: 800,000,000 99.99% Co.,Ltd. Bangkrasor, Muang,Nontaburi 11000 CentralPlaza Rattanathibet Tel. +66(0) 2834-6000

7 Central Pattana Rama 3 Co.,Ltd. 79 Sathupradit Rd., Chongnonsee, Shopping Center: 324,738,000 99.99% Yannawa, BKK 10120 CentralPlaza Ratchda-Rama 3 Tel. +66(0) 2649-6000

8 Central Pattana Khon Kaen Co.,Ltd. 99, 99/1 Si Chan Road, Nai Muang, Shopping Center: 2,000,000,000 78.13% Muang, Khon Kaen. 40000 CentralPlaza KhonKaen Tel. +66(0) 4300-1200

9 Central Pattana Chonburi Co.,Ltd. 55/88-89, 55/91 Moo 1, Samed, Shopping Center: 900,000,000 99.99% Muang, Chonburi 20000 CentralPlaza Chonburi Tel. +66(0) 3764-1880-5

10 Central Pattana Nine Square Co.,Ltd. 9/9 Rama 9 Rd., Shopping Center, 3,200,000,000 93.30% Huai Khwang, BKK 10310 Central Plaza Grand Rama 9 Tel. +66(0) 2103 5999

GENERAL INFORMATION OF BUSINESS HELD BY THE COMPANY 10% UPWARD



11 Central Realty Service 79 Sathupradit Rd., Chongnonsee, Servicing of Shopping 175,000,000 99.99% Rama 3 Co.,Ltd. Yannawa, BKK 10120 Center Facilities Tel. +66(0) 2649-6000 (Hold by Central Pattana Rama3 Co.,Ltd.)

12 Bangna Central Property Co.,Ltd. 587, 589 Bangna-Trad Rd., Shopping Center/Offi ce/ 600,000,000 99.99% Bangna, BKK 10260 Residential/Playland at Tel. +66(0) 2763-6000 CentralPlaza Bangna Project (Hold by Lang Suan Realty Co.,Ltd.)

13 CPN Pattaya Beach Co.,Ltd. 333/99 Moo 9, Nongprue, Shopping Center: 1,500,000,000 99.99% Banglamung, Chonburi 20260 CentralFestival Pattaya Beach Tel. +66(0) 3764-1601-10

14 CentralWorld Co.,Ltd. 4, 4/1-4/2, 4/4 Ratchadumri Rd., Servicing of Shopping Center 2,511,938,100 90.00% Patumwan, BKK 10330 Facilities at CentralWorld, Tel. +66(0) 2640-7000 Shopping Center: CentralPlaza- Udonthani, CentralPlaZa Phitsanulok and renting offi ce (Hold by Bangna Central space at The Offi ces at CentralWorld Property Co.,Ltd. 10.00%)

15 Central Play Land Co.,Ltd. 591 Bangna-Trad Rd., Bangna, Shopping Center: 518,000,000 99.99% BKK 10260 Tel. +66(0) 2763-6000 CentralPlaza Bangna (Hold by Bangna Central Property Co.,Ltd.)

16 Siam Retail Development Co.,Ltd. 5/5-6 M.7 Ramindra Rd., Kannayao, Shopping Center: 500,000,000 15.00% BKK 10230 Tel. +66(0) 2947-5000 Fashion Island (Hold By Lang Suan Realty Co.,Ltd. 12% and

Square Ritz Plaza Co.,Ltd. 3%)

17 Square Ritz Plaza Co.,Ltd. 5/5 M.7 Ramindra Rd., Kannayao, Real Estate Developer 125,000,000 12.00% BKK 10230 Tel. +66(0) 2947-5000 (Hold by Lang Suan Realty Co.,Ltd.)

18 Ayudhya Agrocity Co.,Ltd. 47 M.2 Bangna-Trad Rd., Bangchalong, Real Estate Developer 400,000,000 11.85% Bangplee, Samutprakarn 10540 Tel. +66(0) 2399-4510 (Hold by Lang Suan Realty Co.,Ltd.)

19 CPN Retail Growth Leasehold 119 SCB Park Plaza 3., 21st-22nd, Property Investment in 16,381,000,000 27.80% Property Fund Managed by Ratchadapisek Rd., chatuchak, CentraPlaza Rama 2 Project, SCB Asset Management Co.,Ltd. BKK 10900 Tel. +66(0) 2949 1500 CentralPlaza Ratchada-Rama 3 Project and CentralPlaza Pinklao Project

20 Thai Business Fund 4 Managed by 11 Q House Sathorn Building, M,G Fl., Property Investment in 4,600,000,000 100.00% Krung Thai Asset Management Pcl. South Sathorn Rd., BKK 10120 CentralWorld Project Tel. +66(0) 2670-4900




21 Thai Business Fund 5 Managed by 11 Q House Sathorn Building, M,G Fl., Property Investment in 236,760,000* 100.00% Krung Thai Asset Management Pcl. South Sathorn Rd., BKK 10120 CentralPlaza Bangna Tel. +66(0) 2670-4900

22 CPN Construction Management 999/9 Rama I Rd., Patumwan, Construction Management 1,000,000 99.93% Co.,Ltd. BKK 10330 Tel. +66(0) 2667-5555

23 CPN Pattaya Beach Hotel Co.,Ltd. 333/101 M.9, Nongprue, Hilton Pattaya Hotel 1,000,000,000 99.99% Banglamung, Chonburi 20150 Tel. +66(0) 3764-1601-10

24 CPN Chiangrai Co.,Ltd. 99/9 M 13 , Rop Wiang Muang , Shopping Center : 700,000,000 99.99% Chiang Rai 57000 CentralPlaza Chiangrai

25 CPN Global Co.,Ltd. 999/9 Rama I Rd., Patumwan, Real Estate Developer 1,000,000 99.94% BKK 10330 Tel. +66(0) 2667-5555

26 CPN City Co.Ltd. 999/9 Rama I Rd., Patumwan, Real Estate Developer 1,863,485,000 99.99% BKK 10330 Tel. +66(0) 2667-5555 (Hold by Central Food Avenue Co.,Ltd.

24.99% and Central World Co., Ltd. 75.00%)

27 CPN Complex Co., Ltd. 999/9 Rama I Rd., Patumwan, Real Estate Developer 1,341,600,000 99.99% BKK 10330 Tel. +66(0) 2667-5555 (Hold by Central World Co.,Ltd.)

28 Global Retail Development & 30/F Jardine House One Real Estate Developer HK$10,000 100.00% Investment Limited. Connaught Place Central HK

29 Global Commercial 30/F Jardine House One Real Estate Developer HK$10,000 100.00% Property Limited Connaught Place Central HK

30 Central (Shanghai) Management Room 1107, No.238 Real Estate Developer RMB10,000,000 100.00% Consulting Co.,Ltd. Jiangchang (No.3) Rd., Zhabei District, Shanghai

Remark : * Only capital from owner type unitholders

1 Mr.Vanchai Chirathivat - • • • • • • • • • • • • • - - • - - - - - - - -

2 Mr.Anek Sithiprasasana - • • • • • • • • • • • • - • • • • - - - - - - -

3 Mr.Suthichai Chirathivat • - - - - - • • - - - - - - - - - - - - - - - - -

4 Mr.Sudhitham Chirathivat • • • • • • • • • • • • • • • • • • • • • • - - -

5 Mr.Suthikiati Chirathivat • - - - - - - - - - - - - - - - - - - - - - - - -

6 Mr.Suthichart Chirathivat • - - - - - - - - - - - - - - - - - - - - - - - -

7 Mr.Kobchai Chirathivat • • • • • • • • • • • • • • • • • • • • • • • • • 8 Mr.Prin Chirathivat • • • • • • • • • • • • - • - • • - • • • • - - -

9 Mr.Sudhisak Chirathivat • - - - - - - - - - - - - - - - - - - - - - - - -

10 Mr.Paitoon Taveebhol • - - - - - - - - - - - - - - - - - - - - - - - -

11 Mr.Chackchai Panichapat • - - - - - - - - - - - - - - - - - - - - - - - -

12 Mrs.Sunandha Tulayadhan • - - - - - - - - - - - - - - - - - - - - - - - -

13 Mr.Kanchit Bunajinda • - - - - - - - - - - - - - - - - - - - - - - - -

14 Mr.Karun Kittisataporn • - - - - - - - - - - - - - - - - - - - - - - - -

15 Mr.Sudthidej Chirathivat - • • • - • • • • • • • • • • • - • • • • • - - -

16 Mr.Suthiphand Chirathivat - • • - • • • • - - • • - - - - • - - - - - - - -

17 Mr.Suthipak Chirathivat - - - • • - • • • • - - • • • • - • • - - - - - -

18 Miss Wallaya Chirathivat - • • - - - - - • • - • • • • • • • • • • • - - -

19 Mrs.Narttaya Chirathivat - - - - - - - - - - - - - • - - - - - - - - - - -

20 Mr.Suthilaksh Chirathivat - - - - - - - - - - - - - - - • - - • - - - - - -

21 Mr.Vinyoo Kuvanant - - - - - - - - - - - - - • - - - - - - - - - - -

22 Mr.Yotin Booddicharern - - - - - - - - - - - - - - - - • - - - - - - - -

23 Mr.Jatesiri Booddicharern - - - - - - - - - - - - - - - - • - - - - - - - -

24 Mr.Premchai Karnasuta - - - - - - - - - - - - - - - - • - - - - - - - -

25 Mr.Thaveepol Kongseri - - - - - - - - - - - - - - - - • - - - - - - - -

26 Mr.Jarern Jirawisan - - - - - - - - - - - - - - - - • - - - - - - - -

27 Mr.Peerapon Pattanapeeradej - - - - - - - - - - - - - • - - - - - - - - - - -

28 Mr.Noppadon Pattanapeeradej - - - - - - - - - - - - - • - - - - - - - - - - -

29 Mr.Chanavat Uahwatanasakul - - - - - - - - - - - - • - - - - - - • - - - - -

30 Mr.Sakkanon Chirathivat - - - - - - - - - - - - • - - - - - - - - - - - -

31 Mr.Isareit Chirathivat - - - - - - - - - - - - • - - - - - - - - - - - -

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LIST OF COMMITTEE IN SUBSIDIARIES


EXISTING PROJECTS MANAGED BY CPN

01 CentralPlaza Senior Vice President Property Area 1 : Address : 1693 Phaholyothin Road,

Lardprao Mr. Wiwat Charoensawatpong Chatuchak , Chatuchak, Bangkok 10900

Shopping Center General Manager : Tel : + 66(0) 2793 6000

Ms. Dounghathai Sirichartichai Fax : + 66(0) 2541 1341

02 CentralPlaza Senior Vice President Property Area 1 : Address : 109/10 , Ramindra Road,

Ramindra Mr. Wiwat Charoensawatpong Bangkhen, Bangkok 10220


Ms. Wanphen Kawbuakaew Fax : + 66(0) 2552 5513

03 CentralPlaza Vice President Property Area 2 : Address : 7/222 Baromrachachonnanee Road,

Pinklao Mr. Sathit Wikhantanakul Arunamarin, Bangkoknoi, Bangkok 10700


Mr. Visit Udomkitchote Fax : + 66(0) 2884 8486

04 Central Center Vice President Property Area 3 : Address : 78/54 Moo 9, Pattaya Sai 2 Road,

Pattaya Mr. Sarun Tuntijumnun Banglamung, Chonburi 20260

Shopping Center Assistant General Manager : Tel : + 66(0) 3300 3888

Mr. Pairoj Boonjan Fax : + 66(0) 3300 3888 ext. 1225-7

05 CentralPlaza Vice President Property Area 4 : Address : 2 Mahidol Road, 252-252/1

Chiangmai Airport Ms. Orachorn Chanwiwattana Waulai Road, Haiya, Muang, Chiangmai 50100


Ms. Orachorn Chanwiwattana Fax : + 66(0) 5399 9122-3

06 CentralPlaza Vice President Property Area 3 : Address : 79 Sathupradit Road, Chongnonsee,

Ratchada - Rama 3 Mr. Thanasombat Sanitwongse Yannawa, Bangkok 10120


Mrs. Songsiri Manonunti Fax : + 66(0) 2673 6009

07 CentralPlaza Vice President Property Area 2 : Address : 587, 589 Bangna-Trad (KM.3) Road,

Bangna Mr. Sathit Wikhantanakul Bangna, Bangkok 10260


Mr. Sathit Wikhantanakul Fax : + 66(0) 2399 5777

08 CentralPlaza Vice President Property Area 2 : Address : 160 Rama 2 Road, Samaedum,

Rama 2 Mr. Sathit Wikhantanakul Bangkhuntian, Bangkok 10150


Ms. Duangsamorn Charoenbunditchai Fax : + 66(0) 2872 4560

09 CentralWorld Vice President Shopping Center : Address : 4, 4/1-4/2, 4/4 Rajdamri Road,

Mrs. Oranee Poolkwan Patumwan, Bangkok 10330

Assistant General Manager Shopping Center : Tel : + 66(0) 2640 7000

Ms. Patcharin Apirukworawut Fax : + 66(0) 2255 9767

10 CentralPlaza Senior Vice President Property Area 1 : Address : 68/100, 68/919 Moo 8, Rattanathibet Road,

Rattanathibet Mr. Wiwat Charoensawatpong Bangkrasor, Muang, Nonthaburi 11000


Mr. Nantawat Naovaratpong Fax : + 66(0) 2526 6092

11 CentralPlaza Senior Vice President Property Area 1 : Address : 99,99/9 Moo 2, Chaengwattana Road,

Chaengwattana Mr. Wiwat Charoensawatpong Bangtarad, Pak Kret, Nonthaburi 11120

Shopping Center General Manager (Acting) : Tel : + 66(0) 2101 0000

Mr. Wiwat Charoensawatpong Fax : + 66(0) 2101 1343

12 CentralFestival Vice President Property Area 3 : Address : 333/99 Moo 9,

Pattaya Beach Mr. Sarun Tuntijumnun Banglamung, Chonburi 20260

Shopping Center General Manager : Tel : +66(0) 3300 3999

Mr. Sarun Tuntijumnun Fax : + 66(0) 3300 3999 ext. 1225-6


13 CentralPlaza Vice President Property Area 5 : Address : 277/1-3,271/5 Prajaksillapakhom Road,

Udonthani Mr. Thanasombat Sanitwongse Markkeang, Muangudonthani, Udonthani 41000


Mr. Taninrath Pakdeepinyotavee Fax : + 66(0) 4224 4639

14 CentralPlaza Vice President Property Area 3 : Address : 55/88-89, 55/91 Moo 1,

Chonburi Mr. Sarun Tuntijumnun Sa-Med, Muang, Chonburi 20000


Mrs. Theeraporn Chitnawa Fax : + 66(0) 3300 3179

15 CentralPlaza Vice President Property Area 5 : Address : 99,99/1 Srichan Road, Naimuang,

Khonkaen Mr. Thanasombat Sanitwongse Muang, Khonkaen 40000


Mrs. Amornrat Bunyongsin Fax : + 66(0) 4300 1209

16 CentralPlaza Vice President Property Area 4 : Address : 99/9 Moo 13, Robwiang, Muang District,

Chiangrai Ms. Orachorn Chanwiwattana Chiang Rai 57000 Thailand.


Ms. Thanutchaporn Phongyen Fax : + 66(0) 5202 0900

17 CentralPlaza Vice President Property Area 4 : Address : 9/99 Moo 5 Plaichomphon,

Phitsanulok Ms. Orachorn Chanwiwattana Muang, Phitsanulok 65000


Mrs. Montatip Thongklai Fax : + 66(0) 5500 0990

18 CentralPlaza Senior Vice President Property Area 1 : Address : 9/9 Rama 9 Road,

Grand Rama 9 Mr. Wiwat Charoensawatpong Huai Khwang, Bangkok 10320


Mr. Olarn Vaiudomvut Fax : + 66(0) 2103 5990

Registrar of Common Shares

Thailand Securities Depository Co., Ltd.

4th Floor, The Stock Exchange

of Thailand

62 Ratchadapisek Road, Klongtoey,

Bangkok 10110, Thailand

Telephone: +66(0) 2229 2888

Facsimile: +66(0) 2654 5427

Debenture Holder Representatives

Debentures CPN135A and CPN145A

TMB Bank Public Company Limited

393 Silom Road,Bangrak


Telephone: +66(0) 2626 7503

Facsimile: +66(0) 2266 8150

Registrar of Unsecured Debentures

Debentures CPN126A, CPN136A

and CPN15DA

CIMB Thai Bank Public Company

Limited

44 Langsuan Road, Lumpini

Sub-District, Pathumwan


Telephone: +66(0) 2626 7503

Facsimile: +66(0) 2626 7542

Debentures CPN135A and CPN145A

Kasikorn Bank Public Company

Limited

1 Soi Kasikornthai, Ratburana Road,


Telephone: +66(0) 2470 1987

Facsimile: +66(0) 2470 1998

Debentures CPN127A, CPN126B,

CPN164A, CPN16OA, CPN18OA,

CPN21OA, CPN156A and CPN171A

Siam Commercial Bank Public

Company Limited

9 Ratchadapisek Road, Chatuchak


Telephone: +66(0) 2256 2323-8

Facsimile: 66(0) 2256 2406

Debentures CPN163A

Bank of Ayudhya Public Company

Limited

1222 Rama3 Road,

Bang Phongphang, Yan Nawa,


Telephone: +66(0) 2296 3582

Facsimile: +66(0) 2296 2202

Authorized AuditorKPMG Phoomchai Audit Ltd.

Mr. Vichien Thamtrakul,

Certifi ed Public Account,

Registration No.3183

50th – 51st Floor, Empire Tower

195 South Sathon Road,

Yannawa Sub-District, Sathorn


Telephone: +66(0) 2677 2000

Facsimile: +66(0) 2677 2222

Credit Rating and Debenture Rating CompanyTRIS Rating Co., Ltd.

24th Floor, Silom Complex Building,

191 Silom Road, Silom Sub-District,

Bangrak Bangkok 10500, Thailand

Telephone: +66(0) 2231 3011

Facsimile: +66(0) 2231 3012

REFERENCE FIRMS


Share prices and dividend payments

for the past fi ve years (2007-2011).

Unit: Baht/share

Year Highest price Lowest Price Dividend payment

2007 37.00 18.50 0.33

2008 29.75 7.60 0.33

2009 24.80 11.60 0.58

2010 32.50 17.60 0.25

2011 40.00 25.75 0.37*

Remark: * Subject to AGM approval

Movements of CPN Index against SET Index

and Property Development Index.

Increase of share price index 3 years 1 year

SET Index 52% (2%)

Property Development Index 48% (1%)

CPN Index 85% 39%

3-year comparison of CPN share price, Property Index,

and SET Index (2009 as base-year)

Index (Jan 2009 = 100)

Source: Stock Exchange of Thailand (SET)


Registered Capital: Baht 2,178,816,000

Issued and Paid-up Capital: Baht 2,178,816,000

Comprising of ordinary shares of 2,178,816,000 shares

Par Value of Baht 1 per share

Securities Information

Common shares of Central Pattana Public Company Limited

were listed and traded on the Stock Exchange of Thailand

with “CPN” as the abbreviated security name.

Shareholders’ Meeting

The Board of Directors of Central Pattana Public Company

Limited agreed to hold the Annual General Meeting of

Shareholders (“AGM”) No. 1/2011 on 27 April 2012, at 2.00 pm,

at Bangkok Convention Center, 5th Floor, CentralPlaza Ladprao,

1693 Phaholyothin Road, Chatuchak Sub-District, Chatuchak

District, Bangkok 10900, Thailand.

Investor Relations

Contact person:

Ms. Choenporn Subhadhira

Address:


31st Floor, the Offi ces at CentralWorld,

999/9 Rama I Road, Patumwan Sub-District,

Patumwan District, Bangkok 10330, Thailand

Telephone: +66(0) 2667 5555 ext. 1614 or 1669

Facsimile: +66(0) 2264 5593

E-mail: [email protected]

Website: www.cpn.co.th

Dividend Policy

CPN has a policy to pay dividends at a rate of about 40 percent

of the annual net profi t (unless there is a compelling reason

against this).

CPN

Propery Sector

SET

INFORMATION FOR INVESTORS

300

250

200

150

100

50

0Jan09

Dec11

Oct11

Jul11

Apr11

Jan11

Oct10

Apr10

Jul10

Oct09

Jan10

Apr09

Jul09

Financial Calendar 2011 2012 (Tentative)

Announcement of full year fi nancial results (prior year) February February

Analyst Meeting for full year performance (prior year) March March

The closing date of the shareholders registration book April Aprilfor the rights to attend the AGM

The Annual General Meeting of the Shareholders April April

Dividend payment for the prior year performance May May

Announcement of fi rst quarter fi nancial results May May

Analyst Meeting for fi rst quarter performance May May

Announcement of second quarter fi nancial results August August

Analyst Meeting for second quarter performance August August

Announcement of third quarter fi nancial results November November

Analyst Meeting for third quarter performance November November

Financial Calendar for 2011 and tentative 2012

Date Investor Relations Activities

1 February Local investment conference in Bangkok, organized by Bualuang Securities

24 February Local investment conference in Bangkok, organized by Tisco Securities

7-8 March Investment conference in Australia, organized by UBS Securities

10-11 March Investment conference in Singapore, organized by UBS Securities

14-18 March Non-deal roadshow in The United States, organized by Kim Eng Securities

23 March Analyst briefi ng for the 2010 fi scal year performance at The Stock Exchange of Thailand

28-29 March Investment conference in Bangkok, organized by The Stock Exchange of Thailand

incorporation with Phatra Securities and Bank of America Merrill Lynch

20 April Investment conference in Hong Kong, organized by DBS Vickers Securities

29 April Annual General Meeting of Shareholders 1/2011 at Centara Grand at Central World

25 May Analyst briefi ng for the fi rst quarter of 2011 performance at The Stock Exchange of Thailand

9-10 June Non-deal roadshow in Singapore, organized by Bualuang Securities and Morgan Stanley

23 June Local investment conference in Bangkok, organized by Tisco Securities

4-8 July Investment conference in England, Scotland, Netherlands, and Italy, organized by The Stock Exchange of Thailand incorporation with BNP Paribas

2-3 August Investment conference in Hong Kong, organized by The Stock Exchange of Thailand

incorporation with Daiwa Securities

23-25 August Investment conference in Singapore, organized by Macquarie Securities

30 August Analyst briefi ng for the second quarter of 2011 performance at The Stock Exchange of Thailand

2 September Investment conference in Hong Kong, organized by Bualuang Securities and Morgan Stanley

12-14 October Investment conference in England, organized by The Stock Exchange of Thailand

incorporation with Phatra Securities and Bank of America Merrill Lynch

23 November Analyst briefi ng for the third quarter of 2011 performance at The Stock Exchange of Thailand

29 November – 1 December Investment conference in England, organized by UBS Securities

Investor Relations Activities for 2011

Special Thanks To

> Zen Department Store

> Central Trading Co.,Ltd.

> Dorothy Perkins

> FCUK

> Topshop

> Miss Selfridge

> CIO

> Vintage Passion by SB Furniture

> Fly Now

> Stellaluna

Designed by

Color Party Object Co., Ltd.

Tel : +66 (0) 2300 5124

CENTRAL PATTANA PUBLIC COMPANY LIMITED

30th-33rd Floor, The Offices at CentralWorld,999/9 Rama 1 Road, Patumwan, Bangkok 10330 ThailandPhone: +66 (0) 2667 5555 Fax: +66 (0) 2264 5593

www.cpn.co.th

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